#HedgeFunds Held Close to 20% of $PCG stock. That Bet Flopped #PGandE

"Some hedge funds be­gan buy­ing into PG&E in late 2017 af­ter the wine-coun­try fires in­tro­duced un­cer­tainty around the com­pany and drove down its stock price. By the third quar­ter of 2018—the most re­cent quar­ter for which such data is avail­able—PG&E was one of the hedge-fund in­dus­try's most widely held stocks. About 19% of PG&E stock was held by hedge funds at the end of the third quar­ter, up from 3.4% a year ear­lier, ac­cord­ing to Fact­Set."

In­vest­ment funds in­clud­ing Av­enue Cap­i­tal Group, El­liott Man­age­ment Corp. and King Street Cap­i­tal Man­age­ment LP on Mon­day were buy­ing PG&E bonds, ac­cord­ing to peo­ple fa­mil­iar with the firms. Sev­eral traders said they ex­pected a bank­ruptcy set­tle­ment would re­pay bond­hold­ers in full, based partly on ex­pec­ta­tions that PG&E would set­tle its wild­fire li­a­bil­i­ties for less than ex­pected. As a reg­u­lated util­ity, PG&E also still has cash flow to pay cred­i­tors, and an­a­lysts said Mon­day's clos­ing share price of $8.38 re­flects the po­ten­tial for some kind of res­cue by Cal­i­for­nia law­mak­ers or reg­u­la­tors lead­ing up to the ex­pected bank­ruptcy fil­ing."

Read the full story on The Wall Street Journal here: 

PG&E Was a Hedge-Fund Darling. That Bet Flopped.

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