UPDATE 1-Puerto Rico to present power-authority overhaul ideas to creditors
(Adds background on report)
By Edward Krudy
NEW YORK/SAN JUAN, Puerto Rico Dec 15 (Reuters) - R estructuring experts will present different scenarios to overhaul Puerto Rico's troubled electric power authority (PREPA) to creditors on Monday, but will stop short of recommending job cuts, the president of PREPA's board said in a statement.
The proposals, which will not be made public, were prepared by Chief Restructuring Officer Lisa Donahue of Alix Partners as part of an agreement with creditors.
Creditors have agreed not to accelerate claims on around $9 billion of debt while PREPA tries to turn around its struggling operations.
"Because this draft is covered by the confidentiality agreements between PREPA and its creditors, we cannot comment about its contents," said PREPA President Harry Rodriguez. "Later, we will continue offering a progress report on the restructuring efforts."
El Nuevo Dia, a Spanish language daily in Puerto Rico, a Caribbean island of 3.6 million people, reported that Donahue was meeting with bondholders in New York. Alix Partners declined to comment.
PREPA did not immediately respond to a request for comment.
PREPA relies on oil to produce power, making electricity costs in Puerto Rico about twice the average of the mainland United States. PREPA is widely expected to restructure its debt next year after Puerto Rico's government said it wanted the utility to be self sufficient.
Analysts have said that any restructuring would need to involve converting PREPA's generators to liquefied natural gas, possibly privatizing some power plants, and reducing the size of the workforce.
A spokesman for a New Jersey-based hedge fund that is party to the forbearance agreement declined to release any information about the business plan, citing legal reasons. (Reporting by Reuters in San Juan; Writing by Megan Davies and Edward Krudy; Editing by Bernadette Baum)
© Thomson Reuters 2017 All rights reserved.