On Monday, shares of PG&E Corp dipped after its statement of filling a Chapter 11 bankruptcy protection. The announcement came in the midst of company’s financial sufferings rising from allegation for playing helping role to break a wave of historic wildfires in California.
Earlier on Sunday, the company had reported stepping down of its Chief Executive Officer Geisha Williams, causing nearly 50 percent drop in its share’s price traded early on Monday morning.
More than 80 percent of the company’s value has been vanished over the last three months bringing the value of company to about $4.7 billion from $30 billion which was at its peak of $36 billion in 2017. The lost PG&E has suffered is equivalent to the total value of retail giant eBay.
Under Chapter 11 of the U.S. Bankruptcy Code, the company has served the 15-days notice prior to filing petitions, on or about Jan 29, for reorganization of the company, which also imply to Pacific Gas and Electric, a wholly owned subsidiary of the company.
The PG&E is the largest investor-owned utility company in California having 16 million customers spread over service area of 70,000-square-mile in Central and Northern parts of the state.
There were also some rumors that in order to pressurize the State of California for an aid, company has been faking bankruptcy move but that was not the case as said David Faber of CNBC citing sources.
$30 billion is the at least amount the company has faced against potential liability costs arise from the wildfires in 2017 and 2018. The company not only faced the costs but also faced allegation upon its equipment of being the main cause of those wildfires and those allegations arose reservation by the state official upon safety standards of company’s electric distribution network.
For at least 17 major wildfires in 2107, equipment of PG&E was held liable by the investigators.
