PG&E better amid continuing creditor spat; U.S. Steel lower in manufacturing space

By James McCandless

San Antonio, Dec. 23 – The distressed debt market started a short week following developments in the utilities and manufacturing sectors.

PG&E Corp.’s notes ended the day better as a group of creditors offered wildfire victims all cash as a settlement.

The 6.05% notes due 2034 picked up ½ point to close at 106½ bid.

After the close on Friday, a creditor group of the San Francisco-based bankrupt electric utility said that it was prepared to pay a $13.5 billion settlement to wildfire victims in cash up front.

The group, led by Elliott Management, said in a letter to California governor Gavin Newsom that their settlement prioritizes the victims.

In a similar deal reached last week, the company’s bankruptcy court-approved settlement would be paid half in cash and half in equity in a reorganized entity upon its emergence from bankruptcy.

Elsewhere, in manufacturing, United States Steel Corp.’s issues declined in the aftermath of announcing a guidance cut.

The 6¼ senior notes due 2026 shed ½ point to close at 88 bid. The 6 7/8% senior notes due 2025 lost 1¾ points to close at 94¼ bid.

In the last two trading days, the Pittsburgh-based steelmaker’s structure has been under pressure after several announcements from the company invited market scrutiny on its near-term performance.

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