$20bn power firm failure

Eight of the 10 biggest bankruptcies in corporate history have happened in the past two and a half years, after US energy firm Mirant Corporation buckled under its debts late on Monday night.

The filing piles further misery on lenders, shareholders and bondholders who have lost billions of dollars from the wave of corporate crashes since the boom years of the late 1990s. Barclays is listed in Mirant's bankruptcy petition as one of the company's lenders, and its exposure is put at $112m (£70m).

Creditors have, on average, recovered less from the present spate of bankruptcies than at any other point in the past few decades.

Mirant filed for chapter 11 bankruptcy protection from its creditors a day before repayment was due on $1.1bn debt. According to court documents, it had $20.6bn in assets, $11.4bn in debt and $1.2bn in cash. The filing made it the 10th largest bankruptcy, defined by assets, according to rankings compiled by BankruptcyData.com.

Mirant, like other energy firms, has struggled to stay afloat since confidence in the sector was hurt by the collapse of Enron which, combined with a long slump in prices, caused credit downgrades.

The filing was made after a last-minute attempt to reach agreement with creditors to restructure its debt failed.

The firm lost $2.4bn last year and investors' nerves were further rattled when an audit found $188m in overstated profits.

Mirant was caught up in the widespread allegations of energy price manipulation that caused the Californian energy crisis three years ago.

The scandal-hit telecoms firm WorldCom holds the unwelcome title of the biggest ever bankruptcy. It went under on July 21 last year, with assets of almost $104bn.

The others in the top 10 that have crashed since the beginning of 2001 are Enron, insurer and home lender Conseco, telecommunications company Global Crossing, United Airlines, cable company Adelphia Communications, and the utility Pacific Gas and Electric.