A Delaware judge Friday gave embattled power producer Calpine Corp. until Jan. 22 to repay $313 million owed to bondholders.
Calpine, which has warned it might file for bankruptcy, had sought 90 days to pay back an estimated $313 million that the court earlier ruled it improperly spent on fuel for its power plants. Bondholders wanted the money repaid by Dec. 9.
Vice Chancellor Leo Strine of the Delaware Court of Chancery in Wilmington ruled that the company must repay the $313 million to the creditors plus interest.
Strine last week ruled that Calpine improperly used proceeds from asset sales to buy fuel for its plants, violating terms of its bond indentures.
The judge said Calpine and Wilmington Trust, the trustee for the bondholders, must come up with a plan for some sort of remedy on the $313 million Calpine spent.
Late Thursday Calpine conceded that bankruptcy was an option and said there was a risk that no matter how long a window it gets from Strine, it may not be able to make the full remedy.
Shares of the San Jose, California, company were down more than 16 percent, or 6 cents, to 32 cents, at midday on the New York Stock Exchange.
