Hawaiian Electric Falls After Halting Dividend, Drawing Credit

Hawaiian Electric Industries Inc. slumped after the company said it will draw down on credit lines and suspend its dividend to preserve cash in the wake of deadly wildfires on Maui.

(Bloomberg) — Hawaiian Electric Industries Inc. slumped after the company said it will draw down on credit lines and suspend its dividend to preserve cash in the wake of deadly wildfires on Maui.

The shares tumbled as much as 25% in New York in pre-market trading Friday. Hawaiian Electric, which owns the utility that serves Maui, disclosed after markets closed Thursday that it will halt dividend payouts starting in the third quarter, an unusual move that indicates potential financial distress. In addition, Hawaiian Electric Industries and its Hawaiian Electric utility unit also drew $170 million and $200 million, respectively, on their revolving credit lines.

Hawaiian Electric has come under scrutiny for the role its power lines may have played in sparking the Maui fires that razed the town of Lahaina and killed 115 people. Maui County filed suit against the utility-owner on Thursday for civil damages caused to public property, alleging the utility acted negligently by failing to cut power despite a forecast critical fire conditions. Hawaiian Electric also faces numerous other lawsuits filed on behalf of fire victims.

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