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“Smart Money Keeps Losing on Energy Future Holdings”

November 03, 2015

Josh Kosman in the New York Post:

It’s one of the costliest investments in US history — and some of the country’s savviest investors are still getting clobbered.

Bankrupt Dallas utility Energy Future Holdings has eaten more than $18 billion in investor value — and continues to swallow boatloads of cash as private equity moguls and hedge fund titans keep throwing money at the company in hope of a turnaround that has yet to materialize, sources tell The Post.

KKR, TPG Capital, Goldman Sachs and other co-investors bought the utility in 2007 for $45 billion — at the time the biggest buyout in US history — but lost a total of $8.3 billion after it was forced to file Chapter 11 bankruptcy in April 2014.

Even Warren Buffett’s Berkshire Hathaway wrote off $2 billion in loans to the company as it went broke.

Since then, several other large asset managers gobbled up the utility’s debt, betting that a rise in natural gas and oil prices would underpin a turnaround for the hobbled utility.

But instead of rising, oil and gas prices have tumbled — taking the price of EFH bonds with them.

Smart Money Keeps Losing on Energy Future Holdings

Energy Future Holdings goes to court today to seek an end to its bankruptcy, as reported in the Dallas Morning Post:

Energy Future Holdings Seeks End to Bankruptcy at Trial

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