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Bankruptcy worries hurt stock

Thursday, July 10, 2003 | 9:52 a.m.

Shares of Mirant Corp., a U.S. electricity producer trying to refinance $4.9 billion in debt, had their biggest drop in three weeks this morning after a Merrill Lynch & Co. analyst said the company probably will declare bankruptcy.

The shares fell 25 cents, or 9.3 percent, to $2.45 at 9:38 a.m. in New York Stock Exchange composite trading. The stock of Mirant -- operator of a power plant at Apex near Las Vegas -- has fallen 43 percent in the past year.

Mirant said in a regulatory filing Wednesday that it would offer higher interest rates and other incentives to encourage its banks to approve a reorganization plan administered by a bankruptcy court. The company has a $1.125 billion loan payment due next Wednesday, according to Bloomberg data.

Mirant shares may be worthless if Mirant enters an involuntary bankruptcy, Merrill Lynch said.

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