PREPA judge approves one-week delay for restructuring proposal

Puerto Rico Electric Power Authority bankruptcy Judge Laura Taylor Swain approved a one-week delay of Thursday night's deadline for an Oversight Board proposed plan of adjustment.

The mediators in the Puerto Rico Electric Power Authority bankruptcy asked earlier on Thursday for the delay, citing a lack of data and analyses they were seeking from the board.

"Despite reasonable requests by the Ad Hoc Group [of PREPA Bondholders] and the monolines, the Oversight Board is still in the process of providing basic data and analyses relevant to the ongoing plan negotiations," the mediation team told Swain Thursday. "Without such information, the mediation team believes no further progress towards a consensual resolution can be achieved."

Swain said the mediation team's extension request was "reasonable" and "needed to allow the exchange and review of information necessary to advance negotiations." She approved moving the deadline for the proposed plan of adjustment, disclosure statement, and proposed confirmation schedule to Dec. 8.

The Oversight Board responded to the mediators' filing by saying that it "has cooperated and will continue to cooperate with the mediation team and mediation parties, including providing additional data within the timeframe indicated in the mediators' report, and will continue to carry out its statutory mission to the people of Puerto Rico as well as its stakeholders." .

The mediators asked Swain to direct the board to deliver by close of business on Friday all the information it has relied on in "formulating its current position in the ongoing plan negotiations," to make its professionals available to answer the questions of the Ad Hoc Group's and monolines' professional, and to make good faith negotiations during the extension period.

"Given the importance of the deadline that the court set, the mediation team makes this request reluctantly, but believes that the alternative of filing a plan on Dec. 1, 2022, in the present context would be significantly less conducive to a negotiated resolution of this case," the mediators said.

Swain did not respond to the mediation team's other requests for orders.

Since PREPA entered bankruptcy in mid-2017, the Puerto Rico Oversight Board has not been able to settle with the bondholders and other stakeholders on a proposed plan of adjustment. To hasten the process of achieving a plan of adjustment, in late September Judge Laura Taylor Swain ordered the board to submit a plan with multiple options, dependent on the outcome of litigation, by 11:59 p.m. Thursday.