The Puerto Rico Electric Power Authority and its creditors are set to meet Thursday in New York to discuss ways to restructure the junk-rated utility’s $9 billion of debt, according to a person with direct knowledge of the talks.
Investors, banks and bond insurers plan to meet with the power provider, called Prepa, after the creditors filed a debt-restructuring plan last week, said the person, who asked not to be identified because the negotiations are private. That proposal gives a more favorable outcome for bondholders than the framework that Prepa recommended on June 1, according to the person, who declined to offer details.
Reuters reported the planned meeting earlier on Tuesday.
Prepa owes $416 million of principal and interest July 1. There can be no assurance that the payment will be made, Lisa Donahue, Prepa’s chief restructuring officer, said June 3 by e-mail. A forbearance agreement with creditors that keeps discussions out of court expires on June 30.
Jose Echevarria, a spokesman for Prepa in San Juan, declined to comment, as did Kevin Brown at Armonk, New York-based bond insurer MBIA Inc., Ashweeta Durani at Hamilton, Bermuda-based Assured Guaranty Ltd., and Dan Zacchei, a representative for the forbearing bondholders at Sloane & Co.