SAN JUAN, Puerto Rico (AP) — Puerto Rico's troubled power company announced Tuesday that it reached a deal to restructure about $700 million in expired debt with fuel line lenders.
The Electric Energy Authority said the agreement will in part help generate more liquidity for a company that owes about $9 billion.
Officials said the lenders have two options: converting credit agreements into long-term loans to be paid in six years or exchanging all or part of expired bonds into new bonds worth 85 percent of the existing value.
The agreement comes after the company reached another deal earlier this month with some creditors to reduce principal owed in exchange for new securities also worth 85 percent of the existing bonds.
"We've made significant progress in transforming the Electric Energy Authority," Chief Restructuring Officer Lisa Donahue said, adding that the company is still negotiating with monoline bond insurers.
The agency faces an Oct. 1 payment deadline with fuel line lenders and a group of bondholders.
Puerto Rico is struggling through nine years of economic stagnation and with a $72 billion public debt that the governor has said is unpayable and needs restructuring.