PG&E notes rise after judge signals exit support; Chesapeake better in energy space

By James McCandless

San Antonio, June 16 – At the end of Tuesday’s activity, the distressed space focused on the utilities and energy sectors.

PG&E Corp.’s notes rose to higher levels after its bankruptcy judge signaled his support for the company’s bankruptcy exit plans.

The 6.05% notes due 2034 jumped up 11 points to close at 120½ bid.

During the Tuesday session, news broke that the bankruptcy judge in the San Francisco-based electric utility’s case is going to support the company’s restructuring plan, setting the stage for an emergence from Chapter 11 at the end of the month.

In the energy space, Chesapeake Energy Corp.’s issues ended in a better position after announcing it had elected to forego an interest payment.

The 7½% senior notes due 2026 gained 1½ points to close at 5¼ bid. The 11½% notes due 2025 pushed up 9½ points to close at 16 bid.

On Tuesday, the Oklahoma City-based independent oil and gas producer reported that it would be skipping an interest payment of about $10 million, triggering a 30-day forbearance period.

Reports indicated over the last few days that the company is preparing to file for bankruptcy as soon as this week with a deal that would prioritize senior lenders.

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