California's largest power company plans to file for bankruptcy as it faces tens of billions of dollars in potential liability as a result of forest fires that have ravaged parts of the state in the last two years, according to a filing with Securities and Exchange Commission.
The Pacific Gas and Electric Co. stated on Monday that declaring insolvency is "ultimately the only viable option to restore the financial stability of PG & E to fund ongoing operations and provide a secure service to customers ".
The fires in California, which killed dozens of people and destroyed thousands of homes, led to an increase in claims. PG & E estimates that it could be held responsible for over $ 30 billion, according to the SEC filing, which does not include potential punitive damages, fines or damages related to future requests.
The deposit arrives the day after the company announced the resignation of its CEO, Geisha Williams. PG & E said that it was requested to give employees at least 15 days' notice before filing for bankruptcy that they plan to do "by" on January 29th.
PG & E said last week has about $ 1.6 billion in "cash or cash equivalents" and is arguing with "a number of big banks" to secure more than $ 5 billion to fund its ongoing operations while seeking protection against bankruptcy.
The company said that financial alternatives to bankruptcy would not serve the best interests of PG & E and its shareholders and "will not address the fundamental issues and challenges that PG & E faces". Among the many considerations that have pushed society towards bankruptcy has been the need to solve potential liabilities, extensive reconstruction efforts and "the significant increase in the risk of fires arising from climate change", said PG & E.
PG & E shares fell more than 45 percent in market trading before Monday.