Puerto Rico's public utility PREPA and a key bondholder group have reached the framework of a debt restructuring deal that would include a repayment reduction of up to 15 percent for bondholders, Reuters reported today. The deal, under which PREPA would issue new, securitized debt, likely with a higher credit rating, had not been officially signed and could still fall apart.
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Puerto Rico said that Governor Alejandro Garcia Padilla granted an extension for when advisers are scheduled to deliver a proposal to restructure the commonwealth’s $72 billion debt burden to Sept. 8 because government officials were focused in the past week on the possible impact of tropical storm Erika, Bloomberg News reported on Friday.
Puerto Rico and its main electric utility have spent more than $60 million in legal and advisory fees from firms such as Cleary Gottlieb Steen & Hamilton LLP and Millstein & Co. over the past two years as the governor and public finance officials have sought to restructure the island’s $72 billion debt burden, Bloomberg News reported today.
Federal Reserve Bank of New York President William C. Dudley urged Congress to pass a bill that would allow some agencies of Puerto Rico to file for chapter 9 protection, Bloomberg News reported yesterday.