According to an AP report, the TXU Corporation (NYSE: TXU) is working on plans to break into three separate companies. The break up would occur in the event that the buyout led by KKR and TPG cannot be completed.
Plans for the buyout of TXU were announced in February, and the proposed deal is worth an estimated $32 billion. TXU has been on a road show trying to convince investors to approve the deal, which comes up for a vote in early September, and earlier this week TXU commented on its new plans for a possible break up.
TXU shares have been losing value over the last few weeks, down in the $63 range from a high of $67.90 in early July. Investors are getting nervous that the buyout may not get done as credit markets tighten, raising the cost of the massive borrowing that will fuel the deal.
TXU may break up if KKR buyout fails
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