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Moody’s Investors downgrades TEPCO’s debt rating from A1 to Baa1
Moody’s Investors downgrades TEPCO’s debt rating from A1 to Baa1 due to “the enormous costs the company will incur as it recovers from this disaster including the costs for replacement power, the building of new generating plants to replace the permanently damaged plants and the decommissioning of the containment plant.” Further downgrade is possible. -
TEPCO shares decline 3.7%. News reports say the government will inject funds but not more than 50%.
Prime Minister Kan says he wants to see TEPCO recover as a private entity rather than as a nationalized entity. That means government funding has to stay below 50%. But Yukio Edano, Chief Cabinet Secretary says a larger injection of funds “hadn’t been ruled out.” -
TEPCO President Masataka Shimizu says the company is having difficulty raising funds. It asks the government for assistance.
TEPCO President Masataka Shimizu says the company is having difficulty raising funds. It asks the government for assistance. TEPCO continues with efforts to sell assets and restructure the company. -
Japanese government agrees to a compensation plan to assist TEPCO
The plan establishes a compensation fund in which other utilities would contribute money; does not set a cap on TEPCO’s liabilities, and establishes the issuance of special bonds to fund the program. Asahi Shimbun reports the government will also guarantee loans made by other institutions to TEPCO but requires TEPCO to sell off assets such as real estate to help generate cash. An independent committee comprised of lawyers and accountants will oversee the company’s restructuring effort. -
Standard and Poors reduces TEPCO’s credit rating to junk status.
Bloomberg reports that S&P downgraded TEPCO because it was having difficulty securing loans. The government urges banks to help the utility but lenders are reluctant to loan money to TEPCO over fear of having their own credit rating downgraded if TEPCO has trouble repaying its loans. -
Japanese cabinet approves compensation plan to provide funding to TEPCO and submits bill to the Diet.
Uncertainty exists on whether the Diet will approve the measure. -
The Mainichi Daily reports a secret government bailout plan would nationalize TEPCO’s nuclear operations.
The plan would require TEPCO to sell off its power distribution assets and turn over its nuclear operations to the government. The utility would be allowed to keep its thermal generation business. -
Chairman of Japanese Bankers Association warns TEPCO could become insolvent if parliament fails to approve a bailout package by the end of September.
Reuters reports that during a press conference, the Bankers Association chairman said if no bailout scheme is passed, TEPCO’s insolvency would be immediate. Japanese creditors have been urging the government to assist the utility. -
Japan’s parliament approves $26 billion towards TEPCO’s victim compensation fund.
BBC News reports that TEPCO’s compensation costs may top $100 billion. -
Japan elects Yoshihiko Noda as Prime Minister.
Noda, formerly Japan’s Minister of Finance replaces Naoto Kan who has been critical of TEPCO and has been criticized for his handling of the crises at Fukushima following the tsunami and nuclear accident. -
Japan’s new trade minister suggests creditors should shoulder some of TEPCO’s debt.
According to Reuters, Yukio Edano, the new trade minister said TEPCO and the banks should negotiate how much of the burden creditors would be willing to take. The government will consider how much funding will be provided after a plan between TEPCO and its stakeholders are worked out. -
TEPCO still undecided on details of debt restructuring request.
Reuters reports that TEPCO was still trying to decide whether to ask the banks to waive some of the debt in exchange for a restructuring deal that would include a rate hike. TEPCO needs to increase rates to help pay for its costs but knows any rate increase will not be accepted unless it can demonstrate its commitment to a restructuring plan that will change the way the company has operated. -
Nikkei newspaper reports that TEPCO plans to ask the government for $12 billion from the Nuclear Damage Liability Fund.
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Japanese government approves an $11.5 billion bailout plan for TEPCO.
Trade Minister Yukio Edano approves the plan to help TEPCO with compensation claims to people and businesses affected by the Fukushima accident. Bloomberg reports that TEPCO’s plan includes reducing ¥2.5 trillion in costs by cutting 7,400 jobs. -
BBC News reports that TEPCO announces plan to raise electricity rates for corporate clients beginning April 2012. The increased rates will generate $6.4 billion in additional revenue for TEPCO.
The utility said it may have to raise rates for residential customers in the future. -
TEPCO submits requests for ¥689.4 trillion ($8.8 billion) from the government’s Nuclear Damage Liability Facilitation Fund to pay for victim compensation.
Yukio Edano, Japan’s Trade and Industry Minister said TEPCO should consider becoming a nationalized company. Stocks fall to its lowest value in 37 years. Stock values dipped a total of 91 percent since the accident which reduced the company’s market value by ¥3.1 trillion ($39 billion). TEPCO said it would need to raise rates or to restart its reactors to keep it from becoming insolvent. Edano counters that raising rates is not a right given to all utilities facing financial hardship. -
TEPCO begins talking to banks to secure financing.
Banks define three preconditions for financing: a government injection of capital; 10% increase in electricity rates; restart by next year of idled plants. -
Reuters reports that TEPCO will agree to a government takeover as part of a $13 billion bailout plan.
Although TEPCO has tried to resist a government takeover, it is inevitable given the government’s two-thirds stake as a result of the massive financial infusion. TEPCO is reported to be drafting a corporate restructuring plan that includes requesting additional funding through creditor financing. -
TEPCO shareholders sue company executives ¥5.5 trillion ($67.4 billion) in compensation.
The shareholder suit claims TEPCO executives failed to respond to warning of a possible tsunami and severe accident planning. The money from the executives would be used to pay TEPCO and compensate victims. -
Wall Street Journal reports that TEPCO and the government of Japan fail to reach an agreement. TEPCO asked for ¥ 1 trillion but insisted that the company remain private, not government owned.
“Since the utility has a market capitalization of only ¥350 billion, the capital injection would equate to a stake of more than 70%. But TEPCO and its allies in the business community are firmly opposed to giving a majority stake to the government, arguing that it is incapable of running a utility.” According to the WSJ, Trade Minister Yukio Edano said the government could not use taxpayer money unless it is all allowed to have some influence over management of the company. -
Dow Jones reports that TEPCO filed a plan in which it would sell controlling shares of the utility to the government in exchange for ¥1 trillion ($12.5 billion) in capital.
The plan includes resignation of TEPCO’s CEO Tsunehisa Katsumata and President Toshio Nishizawa. -
Government appoints new CEO and president to lead TEPCO.
Naomi Hirose, who was serving as managing director of the Fukushima disaster compensation fund is named president of TEPCO. Kazuhiko Shimokobe, an experienced turn-around lawyer, was named CEO. -
Japan’s trade minister approves ¥1 trillion ($12.5 billion) injection.
Government to take over more than 50 percent of the utility’s voting shares and will be able to choose board members. -
TEPCO files request to increase residential rates by 10 percent.
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TEPCO announces its candidates to make up the new board of directors.
The appointments to the board are expected to be a finalized at the shareholders meeting June 27. Eleven new members are named. -
Asahi Shimbun reports that potential board member Fumio Sudo may have conflicts of interest since he is also Chairman of the Board for NHK (Japan’s broadcasting company), which reports on TEPCO’s activities.
Other people to be appointed to TEPCO’s board include Yoshiaki Fujimori, president of JS Group Corp.; Takao Tashikani, a certified public accountant; and Kimikazu Noumi, president of the Innovation Network Corporation of Japan. New board members are expected to be approved at the shareholders meeting on June 27. -
TEPCO announces change in major shareholders of the utility.
The notice states that the Nuclear Damage Compensation Facilitation Corporation is expected to become the largest controlling shareholder. The controlling shareholder now owns 50.11 percent of the utility’s voting shares.