The Puerto Rico Electric Power Authority won a legal case challenging its consensual debt restructuring agreement and said it will make its January bond payment.
PREPA will pay the $194 million in bond interest due on Jan. 3, according to a statement from its bond trustee, U.S. Bank National Association. Neither U.S. Bank nor PREPA has explained where the authority will get the money for the payment. The authority has made its recent debt payments by borrowing from some of its bond insurers.
PREPA and its creditors have been moving toward a comprehensive restructuring of its more than $8.4 billion in debt since the summer of 2014. It is currently involved in defending several lawsuits against both the tentative deal with creditors and the legislation that the Puerto Rico government passed for the energy sector in early 2016.
On Tuesday a judgement was rendered on the first of these cases.
The Court of the First Instance (San Juan) in Union de Trabajadores de la Industria Eléctrica y Riego v. PREPA upheld the constitutionality of the PREPA Revitalization Act and upheld the Puerto Rico Energy Commission's restructuring order and Revitalization Corporation's restructuring resolution.
The plaintiffs could appeal this ruling and there could be different rulings in the other cases in the courts.
