© Reuters. A PG&E truck carrying an American Flag drives past PG&E repair trucks in Paradise

By Shanti S Nair

(Reuters) – PG&E Corp rejected a $2.5 billion offer from San Francisco to buy the bankrupt Californian company’s power lines and other infrastructure within the city, calling the offer inadequate.

The offer significantly undervalued the assets and a deal would not be in the best interest of the company’s customers, PG&E’s chief executive officer, Bill Johnson, wrote in a letter to San Francisco Mayor London Breed and City Attorney Dennis Herrera.

The company’s financing strategy to emerge from bankruptcy did not include selling off company assets, Johnson said in the letter, which was dated Oct. 7.

“Although we cannot accept your offer, we want to clearly communicate that PG&E intends to continue working with the City to best serve the citizens and businesses of San Francisco,” Johnson wrote.

San Francisco had made the offer in September, eight months after the utility sought Chapter 11 bankruptcy protection.

Breed and Herrera responded on Friday by saying that San Francisco would continue to pursue the acquisition of PG&E’s electrical assets. They said in a statement that arguments made by the company on the proposal were “inconsistent” with the comprehensive analysis done by the city and its financial advisers.

“We aren’t surprised by PG&E’s response so far,” the two officials said. “We’re also not giving up. Now more than ever, it is clear that we must take back control of San Francisco’s electric service and achieve energy independence.”

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Source link