Dynegy subsidiary files for bankruptcy protection

November 8, 2011 4:40:11 AM PST
A subsidiary of Houston-based power company Dynegy is seeking Chapter 11 bankruptcy protection and says it has agreed with holders of more than $1.4 billion in senior notes on a debt restructuring.

Dynegy Holdings LLC and four of its subsidiaries have filed a voluntary petition in the U.S. Bankruptcy Court for the Southern District of New York. Dynegy says the agreement focuses on a framework for restructuring more than $4 billion in obligations owed by Dynegy Holdings.

Last week, Dynegy Holdings elected not to make a $43.8 million interest payment on some of its outstanding debt.

Dynegy sells electricity to grids and utilities in the Midwest, the Northeast and the West. It has been hurt by lower power prices over the last two years.