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 is skeptical.
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.
“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.
The market seems to disagree. Shares in Hawaiian Electric had already lost two-third of their value between August 8, when the Maui fires began, and Thursday’s close, with the stock down a further 1% in Friday premarket trading.
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.
Write to Jack Denton at [email protected]
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