Calpine files new plan of reorganization

San Jose, CA, and Houston, TX, Aug. 27, 2007 — Embattled Calpine Corp. announced the company and certain of its subsidiaries have filed an amended plan of reorganization and related disclosure statement with the United States Bankruptcy Court for the Southern District of New York. With the filing, Calpine remains on track to have the amended plan confirmed during the 4th Quarter 2007.

The amended plan maintains the key terms provided under the original plan of reorganization filed by the company in June 2007, but projects greater recoveries for stakeholders in the most likely claims scenario. The amended plan remains a “waterfall” plan that allocates value to the company’s creditors and shareholders in accordance with the priorities of the Bankruptcy Code.

Consistent with the original plan, assuming Calpine’s amended plan is confirmed by December 31, 2007 and subject to the assumptions set forth in the disclosure statement, Calpine estimates that the reorganized Calpine will have a midpoint reorganization value of $21.7 billion (reorganization value is equal to total enterprise value plus estimated available cash). At emergence, Calpine estimates that its total enterprise value will be between $19.2 billion to $21.3 billion, with a midpoint of $20.3 billion, and estimates that distributable cash will be approximately $1.4 billion.

Under the amended plan, allowed claims are anticipated to range from $20.1 billion to $22.0 billion after completion of Calpine’s claims objection, reconciliation, and resolution process. Under the range of potential allowed claims, general unsecured creditors will receive from 95% to 100% of their allowed claims. As a result of the continued refinement of the company’s outstanding claims, it has increased the amount holders of existing equity are projected to receive under the updated “most likely” claims resolution scenario. Calpine currently estimates that the return would be approximately $2.05 per existing share of Calpine common stock (calculated assuming the midpoint of the reorganization value). Because disputed claims and the total enterprise value of Calpine upon its emergence have not yet been finally adjudicated, no assurances can be given that actual recoveries to creditors and interest holders will not be materially higher or lower.

Calpine received a commitment for an amended and upsized exit facility from Goldman Sachs, Credit Suisse, Deutsche Bank, and Morgan Stanley. Calpine will ask the Bankruptcy Court to hold a hearing to consider approval of the amended plan. If the court confirms the new plan, Calpine expects to emerge from Chapter 11 shortly thereafter.

For related articles on the continuing Calpine bankruptcy and recovery, please read these articles:

Court allows Calpine to proceed with $5 billion replacement DIP financing

Calpine gets approval to sell power plant; moves forward with bankruptcy recovery plan

Calpine sells excess inventory

Calpine sells interest in Wisconsin power plant

Calpine to sell interest in Cali energy center

Court OKs Calpine power plant sale

Calpine repays $645 million of its 9 5/8% First Priority Senior Secured Notes due 2014

Calpine Power Income Fund announces departure of CFO Geoff Krause

Calpine completes sale of Mexican power plant

Calpine to cut 775 jobs; announces plans to sell non-core power plants

Calpine sells interest in Mexican power plant; general counsel departs

Calpine shifting executive staff to go forward with restructuring plan

Calpine closes $2 billion DIP financing

Calpine declares compensation figures for board; purchases geothermal plants; appoints new board member

Calpine finalizes collateral structure for $2 billion DIP facility

Calpine files to reject two power plant lease agreements

Calpine to eliminate 300 jobs, sell non-core business

Calpine Power Income Fund and its manager in dispute

Default avoided on King City Project: Calpine Power Income Fund; Scott Davido named CFO of Calpine

Calpine receives court approval of $2 billion DIP financing

Calpine announces departure of member of board

Calpine terminates tender offer for outstanding first priority senior secured notes

Calpine receives court approval of first day motions

Calpine files for bankruptcy

Calpine given time to repay debts, but not much

Calpine’s common stock to cease trading on NYSE

Fitch says Calpine exposure does not adversely affect public power sector

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