Talen Wins Court Approval to Raise $1.55 Billion From Creditors

Talen Energy Supply won court approval for an agreement that would raise at least $1.55 billion from creditors to help the company get out of bankruptcy after cutting a deal with senior lenders.

The backstop agreement is designed to guarantee that noteholders buy $1.55 billion worth of the $1.9 billion in new shares that Talen has proposed selling to finance its reorganization.

The approval by a federal judge in Houston is an important step forward in the company’s plan to cut debt and restructure while in bankruptcy. Talen still must file a plan of reorganization, convince enough creditors to vote ...