20 January 2005 - US energy company Mirant filed its proposed Plan of Reorganization and Disclosure Statement on Wednesday, putting into motion a process intended to allow the company to emerge from Chapter 11 protection by mid-year.
The Plan sets out the overall structure of the company and how the claims of creditors and stockholders are to be treated.
"The filing of this Plan of Reorganization represents a key step toward our goal of emerging from Chapter 11 protection by mid-year," said Marce Fuller, President and Chief Executive Officer, Mirant. "We believe this Plan allows Mirant to emerge as a stronger, more competitive company capable of managed growth and re-listing on a major stock exchange. Importantly, the Plan proposes to significantly reduce balance sheet debt, allow Mirant to retain all current U.S. and International assets and operations, and secure adequate financing. Continued service and sufficient credit support for customers would be ensured."
Under the Plan, over $5bn of debt, and over $1bn of other claims, being converted to equity.
"This plan, which we believe properly positions Mirant for a prompt exit from Chapter 11, is the product of extensive negotiations between the company and its official committees," said M. Michele Burns, Mirant's Chief Restructuring Officer and Chief Financial Officer.
Last week Mirant agreed to pay $458m to settle claims it received unfairly high prices for electricity it sold to California utilities during the western US energy crisis of 2000-2001. At the same time, other parties to the settlement attached different values to the agreement.