Aug 14 Puerto Rico's electric power authority
PREPA struck a deal with bondholders on Thursday to develop a
restructuring plan to revive the debt-stricken utility as it got
an extension of vital lines of credit it uses to buy oil. Here
are some facts about PREPA:
: Puerto Rico's highway, water and electricity authorities
hold about $20 billion in bonds. PREPA is widely viewed to be in
the weakest condition of the agencies.
: PREPA has $8.3 billion of outstanding bond issues with
maturities ranging from 2015 to 2043. The bonds are secured by a
pledge of the authority's net revenues, according to Standard &
Poor's. PREPA uses the credit lines to buy oil for its
: PREPA must make a coupon payment to bondholders of about
$209 million in January, according to information provided by
Puerto Rico's Government Development Bank (GDB).
: It has $671 million outstanding under revolving loan
facilities, of which $146 million is from Citigroup Inc
and $525 million from a consortium led by Scotiabank.
: PREPA typically repays its lines of credit with revenue
associated with fuel costs recovered from customers, however the
utility does not currently have surplus liquidity to repay the
amounts, according to Standard & Poor's.
: If it were to fail to make the credit facility payments,
it would not default, but it would increase the likelihood it
will restructure its debt, S&P said.
: S&P in July cut its view on PREPA's power revenue bonds
two notches deeper into junk, to CCC from B-.
: Of PREPA's debt, $9.2 billion is subject to 'The Puerto
Rico Public Corporations Debt Enforcement and Recovery Act'.
Known as the 'Recovery Act', the legislation allows certain
public corporations to restructure their debt.
: The core of PREPA's problems is that it uses high cost oil
to generate electricity. PREPA spends almost two-thirds of its
operating budget, or $2.6 billion, on oil and electricity prices
on the island are double those in the mainland United States.
Oxford Advisors' Krellenstein estimates that PREPA's fuel cost
could be closer to $1 billion if it converts to natural gas.
: After an initial decline uninsured PREPA's bonds have
recovered some of their losses but are still trading at
: PREPA series 2012A revenue bonds with a 5
percent coupon and a 2024 maturity date traded with an average
price of 47.365 cents on the dollar on Wednesday, compared with
a low of 33.820 cents on July 2.
(Compiled by Megan Davies; Editing by Ken Wills)