Submitted by Fox First at Ten on July 6th
NEW YORK (AP) - Dynegy Inc. said Friday that it has filed for bankruptcy protection as part of a plan to reorganize after years of wrestling with falling electricity prices.
The Houston power company, which operates and sells electricity on the open market, said the Chapter 11 filing won't affect its primary assets. Dynegy's coal and natural gas-fired power plants are owned by separate subsidiaries that aren't part of the bankruptcy filing.
"They will continue to operate their businesses in the ordinary course," the company said.
Friday's filing is part of an ongoing plan to manage its debts that surpassed $5 billion last year. One of its subsidiaries, Dynegy Holdings, filed for bankruptcy protection in November.
Its reorganization plan, which calls for paying creditors between 59 cents and 89 cents on the dollar in cash and equity, was cleared on Thursday by a federal bankruptcy court in Poughkeepsie, N.Y.
Dynegy Inc., the parent, now plans to merge with Dynegy Holdings to remove a layer of the corporate structure and keep its assets under one holding company. The company said that it's necessary for Dynegy Inc. to file for bankruptcy protection to make the merger happen.
The company continues to struggle with declining power prices. It reported a first-quarter loss of $58 million, even after cutting out losses from Dynegy Holdings.
Its shares have plunged by 91 percent in the past 12 months.
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