Fees in Energy Future Case Could Hit $270 Million

Mega bankruptcy cases are usually mega expensive.

The Chapter 11 case of Energy Future Holdings, the former TXU Corp., isn’t likely to be an exception. Using the UCLA-LoPucki Bankruptcy Research Database, MoneyBeat cranked some numbers and came up with an estimated cost of around $270 million for the army of lawyers, bankers and consultants working on the case.

The fee calculator prediction tool asks for the debtor’s assets at filing ($36.5 billion), whether the deal is “prepackaged” (no), whether the plan was “prenegotiated” (yes), if it filed near its headquarters (no), the filing year and the debtor’s total revenue in the year before the filing (EFH reports operating revenue, which was $5.9 billion for the year ended Dec. 31, 2013).

The database predicts fees will be $267.1 million. It is 85% confident fees and expenses won’t be less than $85.6 million or higher than $833.3 million.

How does that stack up against other large bankruptcy cases? It’s a pretty good deal compared with the $2.5 billion (and counting) price tag for the Lehman Brothers Holdings Inc. bankruptcy case (the largest ever Chapter 11 with some $691 billion in assets). Total fees in the General Motors, Chrysler and CIT Group bankruptcy cases came in much lower because restructuring plans for the companies were negotiated ahead of the filings.

Here’s a closer look at the costs of some of the biggest bankruptcy cases:

Company
Fees
Assets
Year filed

Lehman Brothers
$2.5 billion*
$691.1 billion
2008

Enron
$793.4 million
$65.5 billion
2001

WorldCom
$620.4 million
$103.9 billion
2002

Energy Future Holdings
$488 million**
$38.7 billion
2014

Washington Mutual
$246.9 million
$327.9 billion
2008

General Motors
$123.9 million
$91 billion
2009

Chrysler
$77.2 million
$39.3 billion
2009

MF Global
$66.6 million
$40.5 billion
2011

Charter Communications
$61.7 million
$13.9 billion
2009

CIT Group
$23.5 million
$80.4 billion
2009

*U.S. fees only, 1/3 of total asset base. Case is ongoing.
**Forecast via UCLA-LoPucki Bankruptcy Research Database
Source: UCLA-LoPucki Bankruptcy Research Database and bankruptcydata.com