Texas Owned Utility Company Goes Bankrupt
Too big just failed.
The troubled Texas utility Energy Future Holdings – which, as TXU, was private equity’s biggest-ever buyout – filed for bankruptcy on Tuesday.
After months of on-again, off-again talks between the company, its owners and a dizzying hierarchy of creditors, the company went into Chapter 11 protection with a plan intended to stave off months of potentially rancorous fighting in court over pieces of the power company.
Energy Future will probably be split between its regulated electricity arm, Oncor, and its unregulated power-generation business. The talks had long been stymied by an array of issues, including whether such a split would create a tax bill of more than $7 billion.
Energy Future will become one of the biggest Chapter 11 filings in corporate history.