Why Shares of PG&E Are Plummeting Today

Shares of PG&E (NYSE: PCG) fell 29% on Thursday morning after a report that the judge overseeing its bankruptcy case will allow alternative restructuring plans to be considered. Those alternatives are likely to be less favorable to equity holders, sending investors running for the exits.

PG&E filed for bankruptcy protection in January as part of its attempt to manage $30 billion in wildfire liabilities resulting from the Camp Fire in northern California, which caused 85 deaths and massive property damage. Equity holders often get wiped out in bankruptcy cases, but there has been an assumption from the start that PG&E would be able to reorganize in such a way that would preserve some amount of equity value.

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Source Fool.com