/raid1/www/Hosts/bankrupt/TCRLA_Public/220509.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Monday, May 9, 2022, Vol. 23, No. 86
Headlines
B R A Z I L
BRAZIL: Ave Gasoline Price Hits Record High, Liter Costs US$1.43
BRAZIL: Will Face Shortage of Buses if Diesel Price Keep Rising
C O L O M B I A
COLOMBIA: S&P Affirms 'BB+' LT FC Sovereign Credit Ratings
COLOMBIA: Swapped $641 Million in Local Public Debt Last Month
D O M I N I C A N R E P U B L I C
DOMINICAN REPUBLIC: Temporarily Removes Import Taxes
E L S A L V A D O R
AES EL SALVADOR II: Moody's Cuts CFR to Caa2, Outlook Remains Neg.
P U E R T O R I C O
BORINQUEN NATURAL: July 19 Hearing on Disclosures and Plan
PUERTO RICO: HTA Files Debt Revamp Plan to Cut $4 Billion Debt
X X X X X X X X
[*] BOND PRICING: For the Week May 2 to May 6, 2022
- - - - -
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B R A Z I L
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BRAZIL: Ave Gasoline Price Hits Record High, Liter Costs US$1.43
----------------------------------------------------------------
RJR News reports that the price of gasoline rose for the 4th
consecutive week at the pumps, according to data from Brazil's
National Agency of Petroleum, Natural Gas, and Biofuels (ANP)
released on May 6.
The average price from May 1 to 6 is the highest in the ANP's
historical series: BRL7.295 (US$1.43) per liter, according to RJR
News.
Gasoline price rises for the 4th consecutive week without a
readjustment by Petrobras and reaches the highest level in ANP's
historical series, the report notes. The highest price was
recorded in Santa Catarina state at BRL8.999 (US$1.77), the report
relays.
About Brazil
Brazil is the fifth largest country in the world and third largest
in the Americas. Jair Bolsonaro is the current president, having
been sworn in on Jan. 1, 2019.
As reported in the Troubled Company Reporter-Latin America on
April 15, 2022, Moody's Investors Service affirmed the Government
of Brazil's long-term Ba2 issuer ratings and senior unsecured bond
ratings, (P)Ba2 senior unsecured shelf ratings, and maintained the
stable outlook.
Standard & Poor's credit rating for Brazil stands at BB- with
stable outlook (April 2020). S&P's 'BB-/B' long-and short-term
foreign and local currency sovereign credit ratings for Brazil
were affirmed in December 2021 with stable outlook. Fitch Ratings'
credit rating for Brazil stands at 'BB-' with a negative outlook
(November 2020). Fitch's 'BB-' Long-Term Foreign and Local
Currency Issuer Default Ratings (IDRs) has been affirmed in
December 2021. DBRS's credit rating for Brazil is BB (low) with
stable outlook (March 2018).
BRAZIL: Will Face Shortage of Buses if Diesel Price Keep Rising
---------------------------------------------------------------
Rio Times Online reports that Brazil's NTU (National Association of
Municipal Transport Companies) has warned in a statement that there
will be shortages of transport in major cities if diesel prices
rise again - which could be announced by Petrobras in the coming
days.
Fuel has risen 35% this year alone, the association announced,
according to Rio Times Online.
NTU warned of the risk of service disruption if another increase in
the price of diesel is confirmed. A total of 43 million passengers
rely on the service every day, notes Rio Times.
About Brazil
Brazil is the fifth largest country in the world and third largest
in the Americas. Jair Bolsonaro is the current president, having
been sworn in on Jan. 1, 2019.
As reported in the Troubled Company Reporter-Latin America on
April 15, 2022, Moody's Investors Service affirmed the Government
of Brazil's long-term Ba2 issuer ratings and senior unsecured bond
ratings, (P)Ba2 senior unsecured shelf ratings, and maintained the
stable outlook.
Standard & Poor's credit rating for Brazil stands at BB- with
stable outlook (April 2020). S&P's 'BB-/B' long-and short-term
foreign and local currency sovereign credit ratings for Brazil
were affirmed in December 2021 with stable outlook. Fitch Ratings'
credit rating for Brazil stands at 'BB-' with a negative outlook
(November 2020). Fitch's 'BB-' Long-Term Foreign and Local
Currency Issuer Default Ratings (IDRs) has been affirmed in
December 2021. DBRS's credit rating for Brazil is BB (low) with
stable outlook (March 2018).
===============
C O L O M B I A
===============
COLOMBIA: S&P Affirms 'BB+' LT FC Sovereign Credit Ratings
----------------------------------------------------------
S&P Global Ratings affirmed its 'BB+' long-term foreign currency
and 'BBB-' long-term local currency sovereign credit ratings on
Colombia. The outlook on its long-term ratings remains stable. S&P
also affirmed its 'B' short-term foreign currency and 'A-3'
short-term local currency ratings.
Outlook
S&P said, "The stable outlook indicates our expectation that
sustained economic growth will help to curtail fiscal deficits and
stabilize net general government debt at around 60% of GDP over the
next two to three years. Moreover, we expect monetary tightening to
help contain inflation. Our base case also assumes broad continuity
in fiscal, monetary, and pro-growth economic policies after a
presidential transition in August 2022."
Downside scenario
S&P said, "We could lower the ratings during the next two years if
economic growth is below our expectations, potentially indicating
less economic resilience in the context of tighter global and
domestic financial conditions, or if the government's ability to
maintain political consensus on policies to sustain growth
prospects unexpectedly weakens. We could also lower the rating if
large current account deficits (CAD) deteriorate, resulting in
higher external debt and an unexpected deterioration in external
financing conditions."
Upside scenario
S&P said, "Conversely, we could raise the ratings over the next 24
months if economic growth is consistently and significantly faster
than expected, coupled with structural measures that reduce
Colombia's fiscal deficit, lower its debt burden, and strengthen
public finances. A larger and more diverse export sector, helping
to reduce external vulnerability and strengthen economic
resilience, could also lead to an upgrade."
Rationale
S&P said, "Our ratings on Colombia are based on its stable
democracy and political institutions, which have sustained
predictable economic policies and cautious macroeconomic management
for many years despite economic shocks. We expect that these rating
strengths will persist after the presidential elections in May
2022, along with continued pragmatism in economic policies from
both Congress and the executive. Colombia also has a flexible
exchange rate and monetary policy flexibility, which remain key
economic buffers against external shocks.
"Our ratings are constrained by a weak external profile, reflecting
high external debt and volatile terms of trade. However, these
risks are partly mitigated by the external assets of Colombia's
private-sector pension funds and the government's access to the
IMF's Flexible Credit Line."
Institutional and economic profile: Well-established institutions
with relatively strong checks and balances, and moderately strong
growth prospects
-- The next administration will face a divided Congress, so
pragmatism will be key for the administration to advance its
economic and other policies.
-- Colombia's growth prospects are favorable compared with its
regional peers, after a strong recovery in 2021.
-- High unemployment and poverty will continue to demand
government policy attention.
Colombia's stable democracy, relatively strong political parties,
separation of powers, and checks and balances are likely to sustain
pragmatic and predictable economic policies following a change in
government this year.
On March 13, Colombians voted in party coalition primaries and
legislative elections. The legislative election resulted in a
divided Congress with gains made by leftist political parties.
However, no party is close to a simple majority in either chamber
of Congress, which will likely contribute to broad continuity in
political practices and limited policies changes, regardless of the
political orientation of the new government. On the other hand, the
future administration may find it difficult to pass structural
reforms in Congress to make social spending more efficient, broaden
the tax base, and advance labor or pension reform.
Colombians will go to the polls again on May 29 (and a second round
on June 19, if needed). The presidential election continues to be
marked by an antiestablishment sentiment, with all leading
candidates running as independent or from the opposition. All
candidates have emphasized shortcomings in the economy and in
social policies, but they differ on the role of the state in the
economy, the timing of structural changes, and, most notably,
energy policy .
The Colombian economy rebounded strongly from the pandemic-induced
recession, growing 10.6% in 2021 (compared with a fall of 7% in
2020), owing to a strong countercyclical policy response, positive
terms of trade, strong consumption, and partial recovery of
investment. High energy commodity prices and significant progress
on the national infrastructure program will sustain growth in 2022
around 4.6%. We expect Colombia to grow an average of 3% in
subsequent years (close to potential growth). As a result, real GDP
per capita will grow, on average, 2% (in line with other emerging
markets) during 2022-2025, and nominal GDP per capita is likely to
rise toward US$7,500 by 2025.
That said, high inflation and global economic slowdown are risks to
S&P's growth forecasts. Colombia has recovered most of the jobs
lost during the pandemic, but the unemployment rate remains high at
12% as of March 2022. Poor social conditions, along with the
hardship of the pandemic, sparked significant social unrest in 2019
and early 2021.
Flexibility and performance profile: A gradual fiscal adjustment,
persistent current account deficit, and a surge in inflation
-- S&P expects gradual fiscal adjustment and continued GDP growth
will help to stabilize the net general government debt just below
60% of GDP.
-- S&P expects moderately high and persistent current account
deficits over the forecast, translating into a weak external
position despite high oil prices.
-- The central bank has been raising its policy interest rate to
contain inflation.
S&P expects a gradual fiscal correction as the government continues
its targeted social programs. That, plus higher interest payments
(as a result of higher debt stock and tighter financial market
conditions) and deficits in a gasoline price stabilization fund,
will sustain government expenditure, as a share of GDP, above
pre-pandemic levels.
Recent fiscal reforms will partially reduce the general government
reliance on one-off revenues, such as asset sales and extraordinary
dividends from public-sector companies. As a result, S&P expects
the general government deficit to average 4% of GDP during
2022-2025. (The general government deficit includes the central
government, central bank, local and regional governments, social
security, and a deposit guarantee fund.) Net general government
debt will likely increase at a marginally higher rate because of
the effect of inflation and currency depreciation, which raises the
value of foreign currency denominated debt.
S&P said, "We expect net general government debt to stabilize just
below 60% of GDP over the next couple of years. We expect Colombia
will rely mostly on domestic market financing, gradually improving
the composition of the debt following a spike in borrowing from
international markets and multilateral lenders during 2020-2021. We
expect that interest expenditure will equal, on average, 14.4% of
general government revenues, a relatively high level that indicates
Colombia's vulnerability to higher global interest rates."
Contingent liabilities are limited. Ecopetrol, Colombia's largest
government-related entity (GRE), significantly increased its debt
(it was 8% of GDP as of year-end 2021) to acquire ISA, an energy
transmission utility and also a GRE. That said, Ecopetrol's det
levels continue to be adequate in terms of cash flow generation.
S&P said, "Our limited contingent liability assessment also
reflects the conditions of Colombia's financial system, which has
assets of 78% of GDP. We classify Colombia in Banking Industry
Country Risk Assessment group '6'. (BICRAs are grouped on a scale
from '1' to '10', ranging from what we view as the lowest-risk
banking systems, or group '1', to the highest risk, or group
'10'.)"
S&P said, "The recent spike in oil prices will help to reduce the
CAD in 2022 to 4.4% of GDP from a high 6% in 2021. We expect the
CAD to average 4.8% of GDP in 2023-2025. As a result, we project
that Colombia's narrow net external debt will remain around 150% of
current account receipts over 2022-2025. Gross external financing
needs should remain just below 100% of current account receipts and
usable reserves during 2022-2025. Hydrocarbon exports comprise
around 30% of current account receipts, highlighting the importance
of the sector for the country's external profile and balance of
payments.
"The external assets of Colombia's individual pension fund
accounts, which we do not include in our narrow net external debt
since they are held by the private sector, reached US$42 billion
(or 12% of GDP and 53% of current account receipts) as of March
2022. These funds are regulated by the government and have helped
stabilize the country's financial markets and boosted external
liquidity. Moreover, the availability of a Flexible Credit Line
from the IMF of US$9.8 billion supports Colombia's external
liquidity.
"We expect Colombia's central bank to continue to raise interest
rates as inflation remains high. Inflation has exceeded the bank's
inflation target of 3% plus/minus 1% since August 2021. Starting in
October 2021, the central bank has raised its monetary policy
reference rate by 425 basis points, to the current 6%. We expect
inflation to average 7% for 2022 and then decline toward 3% by 2023
onward."
The central bank continues to adhere to its long-standing policy of
letting the Colombian peso exchange rate float freely. That said,
the recent economic crisis showcased its capacity to use new tools
to reduce stress in the foreign currency and domestic capital
markets.
In accordance with S&P's relevant policies and procedures, the
Rating Committee was composed of analysts that are qualified to
vote in the committee, with sufficient experience to convey the
appropriate level of knowledge and understanding of the methodology
applicable. At the onset of the committee, the chair confirmed that
the information provided to the Rating Committee by the primary
analyst had been distributed in a timely manner and was sufficient
for Committee members to make an informed decision.
After the primary analyst gave opening remarks and explained the
recommendation, the Committee discussed key rating factors and
critical issues in accordance with the relevant criteria.
Qualitative and quantitative risk factors were considered and
discussed, looking at track-record and forecasts.
The committee's assessment of the key rating factors is reflected
in the Ratings Score Snapshot above.
The chair ensured every voting member was given the opportunity to
articulate his/her opinion. The chair or designee reviewed the
draft report to ensure consistency with the Committee decision. The
views and the decision of the rating committee are summarized in
the above rationale and outlook. The weighting of all rating
factors is described in the methodology used in this rating
action.
Ratings List
RATINGS AFFIRMED
COLOMBIA
Sovereign Credit Rating
Foreign Currency BB+/Stable/B
Local Currency BBB-/Stable/A-3
Transfer & Convertibility Assessment
Local Currency BBB
COLOMBIA
Senior Unsecured BB+
Senior Unsecured BBB-
COLOMBIA: Swapped $641 Million in Local Public Debt Last Month
--------------------------------------------------------------
Reuters reports that Colombia swapped internal public debt worth
2.6 trillion pesos ($641 million) in April, the second such
operation this year and part of an effort to reduce amortizations
and improve the country's debt profile, its finance ministry said.
In the latest operation, the ministry traded TES securities coming
due in 2023 for others tied to inflation which come due in 2035 and
2037 and peso-denominated paper coming due in 2042, according to
the Reuters.
"The transactions took place at market prices and contribute to an
improvement in the profile of Colombia's internal public debt," the
ministry said in a statement, the report notes.
"In particular, the median life (of paper) was extended from 8.97
years to 9.08 years, while the average coupon fell from 9.10% to
9.08%," the report relays.
The swap did not increase the net indebtedness of the South
American country, it added, the report notes. TES paper is the
second most important financing source for Colombia's government
after tax revenues, the report says.
The government swapped 2.3 trillion pesos worth of paper in March
and estimates its net public debt will close the year at 62.7% of
gross domestic product, the report adds.
As reported in the Troubled Company Reporter-Latin America on Dec.
13, 2021, Fitch Ratings has affirmed Colombia's Long-Term Foreign
Currency Issuer Default Rating (IDR) at 'BB+'. The Rating Outlook
is Stable.
===================================
D O M I N I C A N R E P U B L I C
===================================
DOMINICAN REPUBLIC: Temporarily Removes Import Taxes
----------------------------------------------------
Dominican Today reports that the Executive Power enacted the law to
temporarily remove import taxes from 67 tariff subheadings of basic
products for feeding the population, which had been sent by
President Luis Abinader.
The promulgation was made on April 27, the day after the Senate
gave final approval to the bill, according to Dominican Today.
The Government did not make the promulgation decree public, but
Antoliano Peralta, Legal Consultant of the Executive Power,
confirmed to Diario Libre that the piece had been signed into law,
the report notes.
The promulgation of the executive order with the regulations for
the application of the recently approved norm is still pending, the
report relays.
This regulation must establish the mechanism in which the products
to be imported at zero rate, the quantities and other details will
be selected. The same was already drafted and ready, according to
the Minister of Agriculture, Limber Cruz, the report adds.
About Dominican Republic
The Dominican Republic is a Caribbean nation that shares the island
of Hispaniola with Haiti to the west. Capital city Santo Domingo
has Spanish landmarks like the Gothic Catedral Primada de America
dating back 5 centuries in its Zona Colonial district. Luis Rodolfo
Abinader Corona is the current president of the nation.
TCRLA reported in April 2019 that the Dominican Today related that
Juan Del Rosario of the UASD Economic Faculty cited a current
economic slowdown for the Dominican Republic and cautioned that if
the trend continues, growth would reach only 4% by 2023. Mr. Del
Rosario said that if that happens, "we'll face difficulties in
meeting international commitments."
An ongoing concern in the Dominican Republic is the inability of
participants in the electricity sector to establish financial
viability for the system.
Fitch Ratings, in December 2021, revised the Outlook on Dominican
Republic's Long-Term Foreign-Currency Issuer Default Rating (IDR)
to Stable from Negative and affirmed the IDRs at 'BB-'. The
revision of the Outlook to Stable reflects the narrowing of
Dominican Republic's government deficit and financing needs since
Fitch's last review resulting in the stabilization of the
government debt/GDP ratio, as well as the investment-driven
economic momentum, reflected in the faster-than-expected economic
recovery in 2021 that Fitch expects to carry into above-potential
GDP growth during 2022 and 2023.
Standard & Poor's, also in December 2021, revised its outlook on
the Dominican Republic to stable from negative. S&P also affirmed
its 'BB-' long-term foreign and local currency sovereign credit
ratings and its 'B' short-term sovereign credit ratings. The
stable outlook reflects S&P's expectation of continued favorable
GDP growth and policy continuity over the next 12 to 18 months that
will likely stabilize the government's debt burden, despite lack of
progress with broader tax reforms, S&P said. A rapid economic
recovery from the downturn because of the pandemic should mitigate
external and fiscal risks.
Moody's affirmed the Dominican Republic's long-term issuer and
senior unsecured ratings at Ba3 and maintained the stable outlook
in March 2021.
=====================
E L S A L V A D O R
=====================
AES EL SALVADOR II: Moody's Cuts CFR to Caa2, Outlook Remains Neg.
------------------------------------------------------------------
Moody's Investors Service has downgraded the ratings for AES El
Salvador Trust II bis (Trustco II) to Caa2 from Caa1. The outlook
remains negative.
Downgrades:
Issuer: AES El Salvador Trust II bis
Corporate Family Rating, Downgraded to Caa2 from Caa1
Gtd. Senior Unsecured Regular Bond/Debenture, Downgraded to Caa2
from Caa1
Outlook Actions:
Issuer: AES El Salvador Trust II bis
Outlook, Remains Negative
RATINGS RATIONALE
The downgrade of the ratings of Trustco II to Caa2 from Caa1 with a
negative outlook reflects the May 4 downgrade of the sovereign bond
rating of the Government of El Salvador to Caa3 from Caa1 with
negative outlook.
Trustco II ratings factor in heightened refinancing risk for the
$310 million Notes that will mature in March 2023, given the
current challenging financing conditions in the local and global
markets. The ratings also take into account Moody's expectations
that Trustco II's liquidity position will be tight in 2022,
indicating a higher likelihood of a default event.
As of December 2021, the notes' guarantors had $38 million of cash
balance on a combined basis, together with an expected internal
cash generation of $60 million in the 12-month period through
December 2022. This will not be sufficient to cover Trustco II's
liquidity needs, including working capital requirements, capital
expenditures and debt maturities of around $340 million. For
Trustco II's liquidity assessment, Moody's also considers that
under the terms of the Notes, the structure has a six-month debt
service reserve account covering interest only and $16.5 million of
committed credit facilities available.
The ratings acknowledge that the guarantors benefit from an
interest income of approximately $11 million per year on two
intercompany loans amounting to $183.4 million from The AES
Corporation (AES, Baa3 stable) in connection with their
acquisition. The ratings also consider AES' historical track-record
of support through the reduction in the dividend payments from its
El Salvadorian subsidiaries amid the country's financial and
liquidity challenges.
The strong market position of the guarantors, as providers of the
essential electricity distribution service with predictable revenue
streams, are balanced by the dependence on timely subsidies from
the Government of El Salvador (Caa3 negative), which exposes the
company to the sovereign credit quality.
The negative outlook reflects Trustco II's weak liquidity and
refinancing risk, with debt obligations maturing in 2023 along with
Moody's rating outlook of El Salvador's sovereign rating.
In terms of environmental, social and governance (ESG) factors,
Moody's considers that Trustco II has low carbon transition risks
within the regulated utility sector given their transmission and
distribution-only utility operations and lack of any direct
exposure to fossil-fuel generation. However, it is exposed to
potential regulatory changes, a social risk.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded or stabilized if the company extends
its debt maturity profile or improve liquidity cushion ahead of
upcoming debt maturities. Further downgrade pressure could
materialize upon Moody's views that expected recovery for Trustco
II's creditors is weaker than anticipated or a deterioration in the
credit quality of El Salvador. In addition, downward pressure on
the ratings is likely if there is a deterioration in the regulatory
framework that reduces the predictability and consistency with
which the regulation is applied.
Trustco II issued the 10-year $310 million senior global notes due
in 2023 for the benefit of four affiliated electric distribution
companies in El Salvador: Compania de Alumbrado Electrico de San
Salvador, SA de CV (CAESS), Empresa Electrica de Oriente, S.A. de
C.V. (EEO), AES CLESA S. en C. de C.V. (CLESA) and Distribuidora
Electrica de Usulutan (DEUSEM). These four distribution utilities
which are majority owned by The AES Corporation (AES; Baa3, stable)
unconditionally and severally guarantee the debt of Trust II bis,
collectively the guarantors.
The principal methodology used in these ratings was Regulated
Electric and Gas Utilities published in June 2017.
=====================
P U E R T O R I C O
=====================
BORINQUEN NATURAL: July 19 Hearing on Disclosures and Plan
----------------------------------------------------------
Judge Mildred Caban Flores has entered an order that the
evidentiary hearing, the final approval of Borinquen Natural LLC's
Disclosure Statement and confirmation of the Plan, and all other
matters scheduled for May 3, 2022, at 9:00 AM, are rescheduled,
for cause, to July 19, 2022, at 9:00 AM, via Microsoft Teams.
Judge Mildred Caban Flores has entered an order conditionally
approving the Amended Disclosure Statement of Borinquen Natural
LLC.
The hearing for the consideration of the final approval of the
Amended Disclosure Statement and the confirmation of the Amended
Plan and of such objections as may be made to either will be held
on March 9, 2022, at 9:00 AM, via Microsoft Teams.
The objection to the final approval of the Amended Disclosure
Statement and/or the confirmation of the Amended Plan shall be
filed on/or before 14 days prior to the date of the hearing on
confirmation of the Plan.
The acceptances or rejections of the Amended Plan may be filed in
writing by the holders of all claims on/or before 14 days prior to
the date of the hearing on confirmation of the Plan.
The Plan
Borinquen Natural LLC submitted a Plan and a Disclosure Statement.
As of the Petition Date, Debtor's Schedules listed Debtor's
personal property consisting of checking accounts, security
deposits, accounts receivable, furniture, fixtures, inventory,
equipment, prepaid insurance, and prepaid expenses.
Secured Claims, General Unsecured Claims, as well as Priority Tax
Claims, if any, will be paid from the cash resulting from Debtor's
Operations.
Under the Plan, Class 1 General Unsecured Claims of Vendors and
Trade Creditors totaling $114,579 will be paid in equal monthly
installments of $2,123.10 for principal and interest at 4.25% per
year, for a period of 60 months, equivalent to 100% of their
allowed claims. Class 1 is impaired.
Under the Plan, Class 2 Contingent, Disputed and Unliquidated
General Unsecured Claims in Legal Proceedings totaling $1,480,000
will receive no distribution under the Plan. Class 2 is impaired.
Attorneys for the Debtor:
Myrna L. Ruiz-Olmo, Esq.
MRO Attorneys at Law, LLC
PO Box 367819
San Juan, PR 00936-7819
Tel: 787-404-2204
E-mail: mro@prbankruptcy.com
Web: www.prbankruptcy.com
A copy of the Order dated Jan. 26, 2021, is available at
https://bit.ly/3IJKDp7 from PacerMonitor.com.
A copy of the Disclosure Statement dated Jan. 26, 2021, is
available at https://bit.ly/3AFCVtn from PacerMonitor.com.
About Borinquen Natural
Borinquen Natural, LLC, is a corporation organized under the laws
of the Commonwealth of Puerto Rico. It is a limited liability
company engaged in the distribution and sale of a variety of
health
food products. Borinquen Natural owns no real estate properties.
Borinquen Natural filed a voluntary petition for Chapter 11
protection (Bankr. D.P.R. Case No. 21-01058) on March 31, 2021,
listing under $1 million in both assets and liabilities. Judge
Mildred Caban Flores oversees the case.
The Debtor tapped Myrna L. Ruiz-Olmo, Esq., at MRO Attorneys at
Law, LLC, as bankruptcy counsel and Trebilcock & Rovira, LLC as
special litigation counsel. Albert Tamarez-Vasquez, CPA, at Tamarez
CPA, LLC, is the Debtor's accountant.
PUERTO RICO: HTA Files Debt Revamp Plan to Cut $4 Billion Debt
--------------------------------------------------------------
Michelle Kaske of Bloomberg News reports that Puerto Rico's
Highways and Transportation Authority filed its debt-restructuring
plan to the court overseeing its bankruptcy, an agreement that will
allow it to slash $4 billion of bonded debt down to $1.2 billion.
The filing on May 2, 2022, sets in motion the Highways
Authority's possible exit from its five-year bankruptcy this year.
U.S. District Court Judge Laura Taylor Swain will now review the
restructuring deal.
The plan gives bondholders a combined $264 million cash payment and
$1.2 billion of new Highways Authority bonds. Investors will also
receive a so-called contingent value instrument.
About Puerto Rico
Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70 billion,
a 68% debt-to-GDP ratio and negative economic growth in nine of the
last 10 years.
The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.
The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III of
2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ('PROMESA').
The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21, 2017. On July 2, 2017, a Title III case was commenced for
the Puerto Rico Electric Power Authority ("PREPA").
U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases. The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that may
be referred to her by Judge Swain, including discovery disputes,
and management of other pretrial proceedings.
Joint administration of the Title III cases, under Lead Case No.
17-3283, was granted on June 29, 2017.
The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets, as municipal investment
banker, and Ernst & Young, as financial advisor.
Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq., at
O'Neill & Borges are on-board as attorneys.
McKinsey & Co. is the Board's strategic consultant, Ernst & Young
is the Board's financial advisor, and Citigroup Global Markets Inc.
is the Board's municipal investment banker.
Prime Clerk LLC is the claims and noticing agent. Prime Clerk
maintains a case web site at
https://cases.primeclerk.com/puertorico
Epiq Bankruptcy Solutions LLC is the service agent for ERS, HTA,
and PREPA.
O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.
The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.
* * *
The two Title III plans of adjustment have been confirmed to date,
for the Commonwealth and COFINA debtors.
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X X X X X X X X
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[*] BOND PRICING: For the Week May 2 to May 6, 2022
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Issuer Name Cpn Price Maturity Country Curr
----------- --- ----- -------- ------- ---
Noble Holding Internat 5.3 60.5 3/15/2042 KY USD
Provincia de Cordoba 7.1 72.7 8/1/2027 AR USD
Argentina Bonar Bonds 5.8 75.2 4/18/2025 AR USD
Noble Holding Internat 6.1 62.0 3/1/2041 KY USD
Automotores Gildemeist 6.8 54.9 1/15/2023 CL USD
Argentine Republic Gov 8.3 72.9 12/31/2033 AR USD
Provincia de Rio Negro 7.8 70.3 12/7/2025 AR USD
Argentine Republic Gov 0.5 27.6 12/31/2038 AR JPY
KrisEnergy Ltd 4.0 40.4 6/9/2022 SG SGD
Argentine Republic Gov 8.3 72.9 12/31/2033 AR USD
Polarcus Ltd 5.6 71.8 7/1/2022 AE USD
Noble Holding Internat 6.2 62.2 8/1/2040 KY USD
Avadel Finance Cayman 4.5 55.0 2/1/2023 US USD
Automotores Gildemeist 6.8 54.9 1/15/2023 CL USD
Province of Santa Fe 6.9 75.2 11/1/2027 AR USD
Provincia del Chubut A 4.5 2208 3/30/2021 AR USD
Province of Santa Fe 6.9 74.7 11/1/2027 AR USD
Odebrecht Finance Ltd 6.0 16.4 4/5/2023 KY USD
Argentine Republic Gov 6.9 75.2 1/11/2048 AR USD
Odebrecht Finance Ltd 6.0 16.4 4/5/2023 KY USD
Provincia de Cordoba 7.1 74.7 8/1/2027 AR USD
YPF SA 16.5 67.3 5/9/2022 AR ARS
Esval SA 3.5 49.9 2/15/2026 CL CLP
AES Tiete Energia SA 6.8 1.2 4/15/2024 BR BRL
Enel Americas SA 5.8 32.7 6/15/2022 CL CLP
Cia Latinoamericana de 9.5 73.9 7/20/2023 AR USD
Argentine Republic Gov 6.3 74.1 11/9/2047 AR EUR
Argentina Bonar Bonds 7.6 74.4 4/18/2037 AR USD
Provincia de Rio Negro 7.8 70.4 12/7/2025 AR USD
Odebrecht Finance Ltd 6.0 16.4 4/5/2023 KY USD
Metrogas SA/Chile 6.0 41.6 8/1/2024 CL CLP
Province of Santa Fe 6.9 75.2 11/1/2027 AR USD
Argentine Republic Gov 8.3 74.5 12/31/2033 AR USD
Fospar S/A 6.5 1.2 5/15/2026 BR BRL
Argentine Republic Gov 8.3 74.5 12/31/2033 AR USD
Provincia del Chaco Ar 4.0 0.0 12/4/2026 AR USD
Cia Latinoamericana de 9.5 74.3 7/20/2023 AR USD
Sylph Ltd 2.4 65.1 9/25/2036 KY USD
Argentine Republic Gov 4.3 70.0 12/31/2033 AR JPY
Provincia de Buenos Ai 7.9 75.3 6/15/2027 AR USD
Province of Santa Fe 6.9 74.7 11/1/2027 AR USD
City of Cordoba Argent 7.9 73.1 9/29/2024 AR USD
Argentine Republic Gov 8.3 72.9 12/31/2033 AR USD
Argentine Republic Gov 7.1 75.7 6/28/2117 AR USD
Provincia del Chaco Ar 9.4 74.8 8/18/2024 AR USD
Provincia de Rio Negro 7.8 70.3 12/7/2025 AR USD
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Latin America is a daily newsletter
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USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T.
Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A.
Chapman, Editors.
Copyright 2022. All rights reserved. ISSN 1529-2746.
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contact Peter A. Chapman at 215-945-7000.
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