SAN JUAN, Puerto Rico – The sole tentative debt restructuring deal that Puerto Rico reached after two years of negotiations is in jeopardy after a decision by the federal control board to support the U.S. territory's push to amend the agreement with bondholders.
Many believe changes to the deal could mean a deeper cut for those who bought bonds issued by a public power company that has $9 billion in debts.
Gov. Ricardo Rossello told a U.S. congressional hearing Wednesday that the deal made by the previous administration does not call for significant concessions from certain creditors and might affect the utility's ability to update its aging infrastructure and offer more affordable rates.
A bondholders' group says the deal could fall apart, leaving the utility to face a revenue crisis or rate hike.