Aurelius Pushes For Big Swaps Payout On Energy Co.'s 'Insolvency'

Aug 30 2011 | 1:28pm ET

Aurelius Capital Management has taken its fight with Energy Future Holdings to the International Swaps and Derivatives Association.

The hedge fund, which sought a default holding against EFH's Texas Competitive Electric Holdings in February, has asked ISDA to rule that the company is insolvent. Such a holding could trigger $1.2 billion in credit default swaps on the company's debt.

Texas Competitive earlier this month said that its outstanding debt exceeds its enterprise value. Aurelius called that a "flat-out admission" that the company is insolvent.

"Simply put, there is overwhelming evidence that TCEH is insolvent," Aurelius wrote to ISDA.

In April, EFH was able to evade Aurelius' allegations that it had defaulted on its debt by borrowing from Texas Competitive. EFH is owned by private equity giants KKR & Co. and TPG Capital.


In Depth

Debunking Conventional Investment Wisdom

Feb 8 2017 | 3:22pm ET

Due diligence in the hedge fund world has long involved some combination of the...

Lifestyle

'Tis the Season: Wall Street Holiday Parties Back In Fashion

Dec 22 2016 | 9:23pm ET

Spending on Wall Street holiday parties has largely returned to pre-2008 levels...

Guest Contributor

iCapital Network: The Trump Effect On Direct Lending

Feb 23 2017 | 4:21pm ET

The arrival of the Trump Administration has raised questions among private debt...

 

From the current issue of