Puerto Rico Hires Public Financial Management as Adviserby
Philadelphia-based firm will serve through June 2017
Water utility is seeking to raise $2 billion in debt sale
Puerto Rico hired Public Financial Management Inc. to serve as the commonwealth’s adviser on capital financing transactions.
Terms of the agreement weren’t disclosed. The Philadelphia-based firm will assist the island and its various utilities and agencies on pricing and execution of borrowings through June 2017, the Puerto Rico Fiscal Agency and Financial Advisory Authority said in a statement. The authority serves as the commonwealth’s fiscal agent after Governor Alejandro Garcia Padilla in April placed the Government Development Bank in an emergency period as the bank’s liquidity diminished.
PFM served as a financial adviser to the GDB from July 2014 through June 30, 2016, according to Puerto Rico’s Office of the Comptroller. Two contracts for that period total $1.3 million, according to the documents.
In what would be the island’s first bond sale since March 2014, the Puerto Rico Aqueduct and Sewer Authority wants to sell as much as $2 billion of debt for capital projects and to potentially restructure $1.1 billion of existing bonds.
The commonwealth defaulted on nearly $1 billion of principal and interest due to investors on July 1, a day after President Barack Obama signed a bill into law that establishes a financial control board to oversee a restructuring of the island’s $70 billion debt burden.