A bankruptcy court granted energy merchant Mirant Corp. $500 million in debtor-in-possession (DIP) financing on Monday. The company had asked the court to approve the financing, which will be provided through a loan from General Electric Capital Corp., to supplement its cash on hand to fund its merchant power and marketing and trading operations.

Spokesman David Payne said the company “voluntarily agreed to some restrictions, so [the financing] will be broken up into three different pieces: $200 million is currently authorized; the next $100 million will be authorized when we have final approval of our risk management policy by all of our creditors committees or if we get a general order from the bankruptcy court; and the remaining $200 million will be authorized upon written agreement by all of the creditors committees or a general order of the court.”

The company told the U.S. Bankruptcy Court for the Northern District of Texas in Fort Worth that it needed the loan and related letters of credit to maintain the liquidity necessary to operate in the commodities markets. Several of its creditors objected to the steep $15 million closing fee for the loan.

Mirant is one of the few large energy merchants to continue speculative trading — though on a smaller scale — in the power and gas markets, which requires significant collateral to be posted. Payne said Mirant will be putting together a new business plan early next year.

In its monthly operating report filed with the Securities and Exchange Commission, Mirant said it had $39.3 million in net income in the month of August. It reported $17.6 billion in total assets and $14.1 billion in total liabilities, including $1.9 billion in debt. It also reported $1.4 billion in cash and cash equivalents.

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