Judge opens door to PG&E noteholders filing their own reorganization plan

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Judge opens door to PG&E noteholders filing their own reorganization plan

FILE PHOTO: A PG&E truck carrying an American Flag drives past PG&E repair trucks in Paradise, California, U.S. November 21, 2018. REUTERS/Elijah Nouvelage

SAN FRANCISCO (Reuters) – The judge overseeing the bankruptcy of PG&E Corp (PCG.N) on Wednesday issued an order opening the door to a group of noteholders to file their own reorganization plan for the California power provider.

U.S. Bankruptcy Judge Dennis Montali said in his order filed in U.S. Bankruptcy Court in San Francisco that allowing the noteholders to file their plan while PG&E advances its own plan may help reach a global resolution of the case.

Montali added that he favored allowing the noteholders to file their plan because it has the support of the committee representing victims of the massive California wildfires in 2017 and 2018 that pushed San Francisco-based PG&E to seek Chapter 11 protection in January.

The committee of wildfire victims has “spoken loudly and clearly that they want their and the senior noteholders’ proposed plan to be considered,” Montali said in his opinion.

PG&E’s shares plunged 26% in after-hours trade to $8.14 after the judge issued his order.

Reporting by Jim Christie, Editing by Rosalba O’Brien and Tom Brown