PG & E, the country’s largest utility, has filed for Chapter 11 bankruptcy in California.
However, during trading hours on Tuesday, the company filed for bankruptcy, and shares rose by 17 percent.
For Pacific Gas and Electric, the unanticipated Camp Fire in California has cost them over $16.5 billion.
In 2018, the fire was one of the worst and most expensive natural disasters, according to Munich Re, the reinsurance company. There was a fire that started when a PG&E power line came into touch with the neighbouring trees.
Shares of PG & E plummeted after the firm announced it was filing for bankruptcy earlier this month. It was alleged that the business was careless. Earlier in the year, a string of wildfires broke out. Global warming and climate change have been blamed by the CEO of PG&E, who has now resigned, for the disaster.
The Camp Fire in California, which claimed the lives of 88 people and burned 14,000 houses, was the greatest natural disaster ever recorded. In addition to them, a slew of additional structures and establishments were levelled.
According to the California Insurance Commissioner, insurers who were required to pay back the claim have suffered a loss of $11.4 billion. PG&E has estimated that the Camp Fire cost it $16 5 billion.
Investors speculated on how much equity holders might recoup on Tuesday, which led to a dramatic rise in the stock price.
PG & E owes $19 billion in debt and might be out of business for two years if it files for bankruptcy.
At the closing of trading on Tuesday, PG & E’s stock was worth $7.26 billion and closed at $13.99 per share. The stock hit a 52-week high of $49.42 per share in November. However, the company’s market value has dropped by about seventy percent as a result of this.