Bonds

PREPA mediators ask for a fourth deadline extension

The mediators handling the Puerto Rico Electric Power Authority mediation asked Wednesday for the deadline to be extended from Aug. 1 until Aug. 15. 

Puerto Rico bankruptcy Judge Laura Taylor Swain had set 11:59 p.m. Aug. 1 as the deadline for the Oversight Board to achieve a proposed plan of adjustment, a plan term sheet, a litigation schedule, or a declaration and memorandum of law showing why the court should not dismiss the bankruptcy case.

For eight years involved parties have discussed restructuring PREPA’s debt.

On Wednesday the mediators asked for the deadline to be extended to 11:59 p.m. Aug. 15 and to be allowed to extend the deadline on their own to as late as 11:59 p.m. Sept. 9, and to allow the mediation team to extend the deadlines “for purposes of its involvement in any secondary or drafting terms.”

Swain responded by setting a deadline for written responses to the proposed deadline shift for 3 p.m. Thursday and a deadline for replies to those responses at 10 a.m. Friday. After that, Swain said she would consider the submissions and render a ruling. 

If Swain were to approve the current deadline extension, it would be the fourth time she had extended the mediation deadline. In early March she said she wanted the board to submit a proposed plan of adjustment by May 2.

The mediators last asked for an extension in late June. At the time the Unsecured Creditors Committee, a group representing PREPA retirees, and a PREPA union said they supported the mediation extension but also said litigation should start on certain issues. Swain rejected the start of litigation.

In late June the PREPA bondholders said they did not believe the mediation was going forward in “good faith” but said they wanted to continue it.

PREPA bondholders did not respond to a request for a comment for this story.

PREPA has about $8 billion in bond debt outstanding and about $1 billion in other debt. 

While the Oversight Board filed for bankruptcy for PREPA under the Puerto Rico Oversight, Management, and Economic Stability Act in July 2017, there have been talks among some of the involved parties about restructuring PREPA’s debt since summer 2014. 

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