Assured Guaranty has declared its support for The Puerto Rico Electric Power Authority’s (PREPA) announcement that it had reached agreement in principle on terms to modify its restructuring support agreement (RSA).
The RSA has now been extended to April 13, 2017 to allow time for documentation of the modifications. Assured Guaranty Municipal and Assured Guaranty, subsidiaries of Assured Guaranty, are parties to the RSA.
Commenting on the modified agreement, Dominic Frederico, president and CEO of Assured Guaranty said: “We are pleased that PREPA, the Puerto Rico government, Assured Guaranty and other creditors have agreed to terms on modifications to the PREPA RSA that allow for full implementation and are fair to the various parties. We are encouraged that the Puerto Rico government has agreed that the RSA construct for PREPA provides the best path for a consensual resolution of this authority’s financial restructuring. Assured Guaranty has always favoured a constructive approach to resolve the problems of distressed issuers.
“We believe the Oversight Board should promptly facilitate Title VI execution under PROMESA of the modified RSA, which would further affirm that consensual agreements like this one are the most efficient – and likely the only – way to put the Puerto Rico economy back on the road to recovery.”
Similar to the previous version of the RSA, Assured Guaranty will provide surety to support the new securitisation bonds, extend maturity on relending bonds purchased in 2016, commit to purchase $18 million of relending bonds in July 2017 and provide $120 million of principal payment deferrals in 2018 through 2023.
Did you enjoy reading this story? Sign up to our free daily newsletters and get stories like this sent straight to your inbox.
Assured Guaranty, The Puerto Rico Electric Power Authority, RSA, Bermuda