California governor calls on Warren Buffett to buy PG&E

Source: Xinhua| 2019-10-28 10:15:17|Editor: Shi Yinglun
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LOS ANGELES, Oct. 27 (Xinhua) -- California Governor Gavin Newsom wanted Warren Buffett to make a bid for Pacific Gas and Electric Company (PG&E), a major utility supplier which has been blamed for some of the state's most disastrous wildfires recently.

In an interview with Bloomberg, Newsom said if Berkshire Hathaway, the Buffett-led conglomerate, is interested in buying the San Francisco-based company, which serves two-thirds of northern California, now is the time to make an offer.

"We would love to see that interest materialize, in a more proactive, public effort," he said.

Newsom made these remarks after he issued relentless criticism of the utility in recent weeks, blaming PG&E's mismanagement for leading to the deadliest wild fires and mass blackouts across the state.

In a trip to survey areas impacted by Kincade fire in northern California, which has burnt more than 121.4 square km by Sunday, the governor slammed the PG&E, saying it must take responsibility for the wildfires that the local residents have been suffering for years.

To date, six of the most devastating blazes in California's history were triggered by electrical equipment malfunction, including the brutal Camp fire in 2018 that wiped out the mountain town of Paradise, killing 86 residents.

While the cause of the Kincade fire, first reported Wednesday night, has not been determined, the PG&E reported a problem with a transmission tower near the spot where the fire was ignited. This incident made the company's stock price plunge by nearly one third on Friday to only 5 U.S. dollars a share.

About 200,000 residents in northern California threatened by the Kincade fire were evacuated and thousands firefighters were assigned to battle the blaze.

The Sacramento Bee newspaper reported Sunday that Berkshire Hathaway's energy subsidiary has heavily invested in the utility business, in California and elsewhere. It owns multiple solar farms, including a 550-megawatt facility in central California's San Luis Obispo County, which is among the world's largest.

Berkshire Hathaway has not responded to Newsom's offer, the report added.

Jared Ellias, a bankruptcy law expert at the University of California Hastings College of Law, was quoted as saying that the Kincade fire might scare off buyers wrestling for control of PG&E.

He said that Newsom's hope that Berkshire Hathaway steps in could be wishful thinking, adding that "it feels a bit like longing for a savior when there isn't an obvious solution or a cheap solution ... there isn't a white knight."