Aug 27 (Reuters) - Energy Future Holdings, the big Texas power company that filed for bankruptcy in April, said it will present a proposal for auctioning the company after it scrapped an earlier plan to exit Chapter 11 under control of unsecured creditors.
The company said it was evaluating potential proposals it received from financial and strategic bidders, and opting for an auction may indicate increasing interest in the company.
"We believe that a transparent and court-supervised marketing process will maximize the assets' value, and we look forward to providing the court with proposed procedures for this marketing process in the coming weeks," said a statement from company spokesman Allan Koenig.
The company had previously said it was in discussions with potential bidders, which included Hunt Consolidated and NextEra Energy Inc. Energy Future's crown jewel is its regulated power distribution business known as Oncor.
NextEra had presented the U.S. Bankruptcy Court in Wilmington, Delaware, with a proposal for acquiring post-bankruptcy control of Energy Future, but the Florida company withdrew that on Tuesday. It said in a court filing it was pulling its proposal because an auction process would soon be presented.
NextEra's shares ended Wednesday up about 1 percent at $96.89 on the New York Stock Exchange.
Bankrupt companies often opt for auctions as way to ensure they are getting the best price for their assets. The money raised would be used to repay some of Energy Future's $40 billion in debt.
Judge Christopher Sontchi will have to approve rules for presenting bids and holding the auction. Bankruptcy auctions often take at least three months from the first proposal until the sale is approved by the court.
Energy Future owns two unregulated units, the Luminant generating business and the TXU Energy retail utility. The company has proposed spinning those units off to senior creditors.
Energy Future took on much of its debt in 2007, when it was formed with the record buyout of TXU Corp, led by KKR & Co , TPG Capital Management and the private equity arm of Goldman Sachs.
The deal turned out to be an ill-timed bet on natural gas prices, which soon began to plummet.
The case is In Re: Energy Future Holdings Inc, U.S. Bankruptcy Court, District of Delaware, No. 14-10979 (Reporting by Tom Hals in Wilmington, Delaware; Editing by Tom Brown)