The majority of holders by par value in all Puerto Rico Sales Tax Financing Corp. (COFINA) classes voted in favor of the proposed plan of adjustment.
The Puerto Rico Oversight Board announced the unaudited results on Wednesday.
A majority of holders in all 10 voting classes approved the deal. The board said the vote was “overwhelming” in favor of the deal. The board said over 8,000 bondholders returned ballots, showing the success of the solicitation process.
“We are confident that the [COFINA plan of adjustment] will be approved at the confirmation hearing and that this important restructuring can be consummated shortly thereafter,” said Board Executive Director Natalie Jaresko. Title III bankruptcy Judge Laura Taylor Swain is scheduled to hold a hearing on the COFINA plan on Jan. 16 and 17.
COFINA is the largest type of Puerto Rico public sector bond, with more than $17 billion in par outstanding in either senior and subordinate bonds.
For the judge to approve the deal at least one of the 10 classes needed to vote in favor of it.
An overwhelming vote in favor of the deal will make it more likely the judge will approve it, said Chapman Strategic Advisors Managing Director James Spiotto. Spiotto is an expert on U.S. municipal bankruptcy.
At least seven objections have been filed against the deal. Swain will consider these at the Jan. 16 and 17 hearing.
