(Adds no comment from Goldman Sachs, KKR and TPG Capital)
April 2 A plan being discussed to reorganize
power company Energy Future Holdings Corp will all but wipe out
the investments of owners KKR & Co, TPG Capital
and Goldman Sachs Capital Partners, Bloomberg reported.
The private equity firms may accept as little as 1 percent
of the equity in debt-laden Energy Future Holdings after it
completes a Chapter 11 restructuring, Bloomberg reported, citing
three people with direct knowledge of the negotiations. (r.reuters.com/dum28v)
Energy Future was formed after KKR, TPG and the unit of
Goldman Sachs Group Inc led a record $45 billion
leveraged buyout of former TXU Corp in 2007.
Energy Future was expected to report that its auditor had
determined it could not survive as a going concern, a finding
that would have triggered a default on its loans and a likely
However, the company said on Monday it has extended a
deadline to file its annual report, giving it more time to
negotiate with creditors as it seeks an agreement to reduce its
crushing debt of more than $40 billion.
Sources close to the debt restructuring talks have told
Reuters that the company is likely to be broken up in
The proposal, which may still fall through, would also give
full legal releases to KKR, TPG and Goldman Sachs, Bloomberg
Energy Future was not immediately available for comment
outside regular U.S. business hours.
Goldman Sachs, KKR and TPG declined to comment on the
Energy Future owns 14 power plants, including five
coal-fired plants. Its generation business, Luminant, and
regulated distribution unit, Oncor, both rank among the largest
in the United States.
(Reporting by Supriya Kurane in Bangalore; Editing by Joyjeet
Das and Maju Samuel)