Creditors sue Energy Future for $665 million
A group of creditors in the Energy Future Holdings bankruptcy case are suing the power company, claiming its restructuring plan leaves them $665 million short.
CSC Trust, which represent a group of senior creditors in EFH’s trasnsmission arm, contends the company is trying to avoid paying them a premium due under the terms of their debt contracts.
Under the restructuring plan presented last month, EFH would refinance $3.5 billion in debt owed the creditors in Energy Future Intermediate Holdings through so-called debtor in possession loans. The debt contains provision that under such a refinancing, the creditors must be paid $665 million for their lost interest, according to the lawsuit.
Allan Koenig, a spokesman for EFH, declined to comment on the specifics of the case.
“It is not uncommon for certain parties to try to use the bankruptcy process to advance their own financial interests, regardless of the merits,” he said in an e-mail.
The litigation, filed Thursday in Delaware federal court, represents the latest challenge to EFH’s plans for a quick 11-month trip and out of bankruptcy court.
A group of creditors from the company’s power generation and retail unit, including hedge fund Appaloosa Management, filed a motion last month challenging EFH’s restructuring plan as leaving large swaths of creditors with little compensation for their billions in debt.
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