Puerto Rico announces deal to restructure power authority debt

Puerto Rico announces deal to restructure power authority debt

Puerto Rico’s power utility struck a deal with a group of creditors that seeks to allow the bankrupt U.S. commonwealth to restructure more than $8 billion of bonds, according to an announcement by government authorities on Friday, reports Trend with reference to Reuters

A group of Puerto Rico Electric Power Authority (PREPA) bondholders, bond insurer Assured Guaranty Corp, along with the island’s government and federally created financial oversight board, reached a restructuring support agreement that would reduce the utility’s debt by up to 32.5 percent.

The move paves the way for a plan of adjustment for PREPA, which filed for a form of bankruptcy in July 2017 after a previous restructuring deal fell apart. The latest agreement, which requires support from at least 67 percent of voting bondholders to materialize, would shed about $3 billion in debt service payments over the next decade.

The deal also requires the approval of a U.S. judge hearing Puerto Rico’s bankruptcy cases, as well as legislative action.

Under the agreement, investors will exchange their PREPA bonds at 67.5 cents on the dollar for new Tranche A bonds and 10 cents on the dollar for new Tranche B bonds. The latter would be contingent on full payment of Tranche A bonds and future electricity demand on the island.

PREPA will pay off the new bonds through a special charge levied on its customers. The new charge starts at approximately 1 cent per kilowatt hour prior to the deal’s closing, increasing to some 2.768 cents per kilowatt hour upon closing and gradually increasing to approximately 4.552 cents per kilowatt hour during the expected 40-year lifespan of the bonds.

The deal still lacks the support of other PREPA creditors, most notably bond insurer National Public Finance Guarantee Corp. A spokesman for National declined to comment.

National Public Finance filed an objection last month when a deal in principle was announced, saying that “until very recently” it was excluded from negotiations even though it is PREPA’s largest creditor. National has also asked the court to appoint a receiver for PREPA, support among other creditor remains unclear following Friday’s announcement.

According to government and board officials, the privatization of PREPA is under way, with transmission and distribution contracts with private companies expected to be in place by the second quarter of 2020.

“Now with this agreement we take a monumental step to provide for the restructuring of the debts and obligations of PREPA and finally conclude the bankruptcy process,” Governor Ricardo Rossello said in a statement.

If approved in federal court, PREPA’s restructuring would mark the third major deal in Puerto Rico’s efforts to restructure about $120 billion of debt and pension obligations. Deals involving the island’s sales tax-backed bonds and Government Development Bank have been approved by U.S. Judge Laura Taylor Swain.

PREPA’s financial and operational problems were compounded by Hurricane Maria, which slammed into the island in September 2017, decimating an electric grid already struggling due to poor rate collection, heavy management turnover and lack of maintenance.

Subscribe to Trend in Google News! Subscribe
Georgia ready to become platform for trilateral dialogue with Azerbaijan, Armenia - FM
Georgia ready to become platform for trilateral dialogue with Azerbaijan, Armenia - FM
Netherlands calls for progress on demarcation, delimitation of Azerbaijan-Armenia border
Netherlands calls for progress on demarcation, delimitation of Azerbaijan-Armenia border
Cavushoglu, Blinken discuss situation in Azerbaijan and Armenia
Cavushoglu, Blinken discuss situation in Azerbaijan and Armenia
Loading Bars
Latest
Iran highlights need for more customs cooperation with Pakistan
bp discloses investments in construction of power plant in liberated Azerbaijani lands
Turkmen gas may be supplied to Europe via Caspian Connector project - ambassador
Turkish, Russian Presidents hold phone talks
Azerbaijan’s Pasha Holding talks about development strategy
Azerbaijan's Heydar Aliyev Foundation, UNICEF sign another memorandum of understanding (PHOTO)
Azerbaijan shares data on number of vaccinated citizens
Azerbaijani, Turkish military pilots conduct joint training flights in Baku (PHOTO/VIDEO)
Azerbaijan confirms 1,703 more COVID-19 cases, 2,180 recoveries
Turkmenistan can supply natural gas to European market until 2050 - ambassador
Azerbaijan discloses export volume of petroleum coke
Azerbaijan's Finance Ministry to auction gov't bonds via Baku Stock Exchange
SOCAR begins testing of new mobile diving complex
Israeli co Fireblocks raising $400m at $8b valuation
Croatia remains one of Russia’s key partners in EU
Value of goods transported via road increases in Azerbaijan
U.S. job growth misses expectations in Nov.
Policy and Management Consulting Group shares data on Georgia’s economic outlook
Georgia, Qatar discuss favorable investment climate
Price indexes of financial, trade sectors at Uzbek stock exchange fall
Uzbekneftegaz obtains new industrial gas flow from Kulbeshkak field
Uzbek Statistics Committee shares data on imports of meat for 10M2021
Georgia’s economic climate remains stable – PMC
Uzbekistan reveals volume of bank loans allocated to various sectors of economy
Iran, Turkmenistan and Azerbaijan gas swap - win-win deal, says Iranian analyst
FMs of Azerbaijan, Poland hold meeting within OSCE Ministerial Council
Co-op between Turkmenistan, EU to focus on improving business climate till 2027
Azerbaijan's food import volume down for 10M2021
Zones free from animal diseases being created in Azerbaijan’s Karabakh, East Zangazur
Azerbaijan considers opening Indonesian Chamber of Commerce
Azerbaijan increases chemical production volume for 10M2021
Azerbaijan, Turkey begin work on establishing joint university - minister
Azerbaijan’s liberated territories have several types of renewable energy sources– RES agency
Azerbaijani parliament adopts amendment to servicemen insurance law
Azerbaijan may exempt sale of electric cars from VAT
Azerbaijan introduces excise taxes on electronic cigarettes, shisha
Concept for creation of "green energy" zone in Azerbaijan’s liberated territories prepared
Transaction to sell Chinese oil company’s stake in Azerbaijan closed
Output volume at Azerbaijan’s Kursangi, Garabagli fields revealed
Austrian interior minister becomes candidate for country’s next chancellor
Azerbaijan begins geological exploration at Tutkhun gold deposit in Kalbajar
Iran to import hay from Russia
Uzbek home appliance manufacturer Artel joins United Nations Global Compact
Economic stability - framework of Iran`s next year budget
BioNTech CEO confident of quickly adapting vaccine for Omicron
Situation is still fragile in South Caucasus - OSCE Chairperson-in-Office
Azerbaijan to strengthen social protection of population in 2022 – PM
Azerbaijan may exempt import of books and paper from VAT
Iran reveals its non-oil trade in 7 months
Iran aims to build new oil, gas refineries amid growing consumption
Uzbek Central Bank shares data on leading banks in terms of loans
Azerbaijani PM talks on measures to curb price increase
Iran seeks to establish joint banking network with Syria
Azerbaijan to expand agriculture dev’t in Karabakh in 2020 – minister
Demining of water basins in Azerbaijan's liberated Fuzuli, Aghdam underway - ministry
Azerbaijan removes electronic bracelets from 134 convicts within amnesty act
India seeks strong ties with EU, cooperation in transition to clean energy
Dubai's DP World pulls out of Haifa port privatisation bid
Azerbaijani Artillery Units hold live-fire exercises (PHOTO/VIDEO)
Azerbaijan to change state duties on issuing registration plates of road vehicles
Georgian business sector sees average monthly salary increase
Cementing ties with France, UAE places $19 bln order for warplanes, helicopters
Azerbaijan preparing development strategy for Karabakh - Karabakh Revival Fund (PHOTO)
Man of Armenian origin who attacked Azerbaijani soldier neutralized – MoD
Azerbaijan releases 14 prisoners from correctional institution № 16 as part of amnesty act (PHOTO)
Azerbaijan releases 122 prisoners from correctional institution within amnesty act (PHOTO)
Australia calls on Azerbaijan, Armenia to delimit and demarcate state borders
Azerbaijan sees growth of trading via Baku Stock Exchange
Azerbaijan to release 65 female prisoners within act of amnesty
Georgia’s domestic supply of natural gas slightly decreases
Azerbaijan clears almost half of "Araz Valley Economic Zone" Industrial Park of mines - minister
Azerbaijan releases seven prisoners within act of amnesty (PHOTO)
Azernews newspaper selected as media partner of ECO from Azerbaijan (PHOTO)
bp is first company to use flexible approach in management of energy resources during pandemic
Turkey’s fuel exports to Georgia plummet
EU firms in infrastructure sector spent higher share of their investment on energy efficiency
Azerbaijan to strengthen control over allocation of subsidies
Share of EU firms investing in improving energy efficiency falls
Partnered with Azerbaijani banks, VISA actively developing technologies for issuing digital cards
Azerbaijan expands list of goods not covered by VAT refund
Georgia’s electricity exports triple
Azerbaijan’s justice ministry talks number of people released under amnesty act (PHOTO)
Further strengthening of Azerbaijan's army is one of important tasks – PM
Azerbaijan discloses expenses on COVID-19 vaccination
Opening of Zangazur corridor is one of most important issues – PM
Azerbaijani Parliament adopts amendments to Tax Code
Over half of EU firms affected by physical climate change risks
Russia records over 32,900 COVID-19 cases in last 24 hours
Head of Azerbaijan’s State Border Service visits servicemen injured in recent helicopter crash
Average salary in Israel rises 2.9%
EDB may help Uzbekistan to solve problems related to water, energy shortages
Turkey shares cargo traffic data for local Aliaga port in 10M2021
Azerbaijani parliament approves subsistence minimum size for 2022
Azerbaijan’s parliament adopts amount of need criterion for 2022
Azerbaijani Parliament adopts budget of State Social Protection Fund for 2022
Azerbaijan’s justice ministry talks number of people released under amnesty act from correctional institution № 1 (PHOTO)
Kazakhstan reports increase in bilateral trade with Germany
New U.S. COVID-19 international travel testing rules take effect Monday
Azerbaijan’s justice ministry reveals number of persons released under amnesty act (PHOTO)
Value of Azerbaijan's export to Italy grows in 10M2021
All news