Hawaiian Electric,
the utility provider accused of playing a role in starting devastating wildfires in Maui, Hawaii, has said that it is seeking advice but intends to endure as a financially strong utility. The market reaction has been volatile.
The company faces accusations that downed power lines may have caused fires that destroyed the town of Lahaina last week in a tragedy that officials said cost 110 lives as of Wednesday, though that number is expected to rise significantly. Hawaiian Electric (ticker: HE) also faces a lawsuit seeking class-action status alleging that the group didn’t turn off power despite official warnings of high fire danger conditions.
The company didn’t respond to requests for comment from Barron’s but has told Bloomberg that it doesn’t have information on what caused the fires.
The company is in talks with firms specializing in restructuring advisory work as it explores options to address its financial and legal challenges, The Wall Street Journal reported Thursday, citing people familiar with the matter. The company’s bonds have plunged in price since the wildfires, an indication of unease among creditors.
“Like any company in this situation would do, and as we do in the normal course of business, we are seeking advice from various experts. This is part of prudent scenario planning. The goal is not to restructure the company but to endure as a financially strong utility,” the company said in filings on Friday, responding to what it said was a frequently asked question of whether it had retained restructuring advisors.
Shares in Hawaiian Electric had already lost two-thirds of their value between Aug. 8, when the Maui fires began, and Thursday’s close, and the stock continued to see volatility on Friday. Shares in the company initially were lower in the premarket session, rose 11% at the open of trading, and at last check had gained 6.7%.
Write to Jack Denton at [email protected]
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