Hedge fund Elliott Management Corp filed a lawsuit against Energy Future Holdings Corp on Thursday, claiming that the bankrupt power company has prevented it from pursuing better options for it as its $18.7 billion deal with NextEra Energy Inc (NEE.N) falters.
Energy Future's plan to exit its three-year-long bankruptcy hinges on selling its majority stake in Oncor, Texas' largest power distribution network, but that deal is in limbo since state regulators scuttled it over concerns it would not benefit ratepayers.
Elliott, Energy Future's largest creditor, wants to lay the groundwork for a plan of reorganization for Energy Future that involves converting its significant debt holdings in the company to equity, eventually putting Oncor under the hedge fund's control, according to the lawsuit, which was filed in U.S. Bankruptcy Court in Delaware. Other options include finding another buyer for Oncor.
Copyright May 15, 2017, Mike Shiloh, Texas Energy Report LLC, www.texasenergyreport.com, All rights are reserved