Puerto Rico Electric bondholder group offers liquidity to pay coupon

By Caroline Salls

Pittsburgh, June 29 – The Puerto Rico Electric Power Authority (Prepa) bondholder group announced Thursday that before the expiration of the Prepa restructuring support agreement, Prepa refused the bondholder group’s offer of $170 million of additional liquidity.

According to a bondholder group news release, this incremental financing, along with the $280 million that the support agreement parties had already agreed to lend, would have fully funded Prepa’s July 1 coupon payment and allowed it to honor its obligations and avoid lawsuits.

The bondholder group said it offered to extend the restructuring support agreement to June 30 to give Prepa time to evaluate this proposal.

Following the dismissal of these offers, the bondholder group said it recognizes that Prepa is likely to file for Title III relief.

“While we expect negotiations with the oversight board and Puerto Rico to continue, the group stands ready to defend and enforce its rights as necessary,” the release said.

In addition, bondholder group Stephen Spencer said in the release “we continue to believe the RSA represents the best path forward for Prepa, and remain open to working with Prepa and the oversight board to implement our deal.”

Puerto Rico announced its Title III petition filing on May 3. The case number in the U.S. Bankruptcy Court for the District of Puerto Rico is 17-03283.

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