Competitive power producer Luminant and retail energy provider TXU Energy – with 17,000 megawatts (MW) of generation and nearly 1.7 million retail customers, respectively – have emerged from Chapter 11 bankruptcy as a new business called TCEH, their parent company, Energy Future Holdings (EFH), announced on October 4.
The newly formed, Dallas-based organization, which produces and sells electricity in North Texas, will act as a standalone company through a tax-free spinoff of Energy Future Holdings. The restructuring eliminates more than $33 billion in debt, according to a report in the Fort Worth Star-Telegram.
“TCEH Corp. emerges from the restructuring process with a superb integrated business,” newly appointed CEO Curt Morgan, an energy industry veteran, said in a prepared statement. “This includes TXU Energy and Luminant — both of which are competitive, well-resourced and positioned for continued operational excellence in the growing Texas market with a strong balance sheet and the potential for stable earnings and significant cash generation.”
The plan for the new company satisfies necessary conditions, including regulatory approvals required by EFH’s reorganization plan, which was approved on August 29 by the U.S. Bankruptcy Court in Delaware.
TCEH’s liquidity position, according to the Star-Telegram, is estimated at $1.65 billion, including $750 million of undrawn net borrowings available under the company’s new $4.25 billion financing facility, the company stated.