Franklin Advisers and OppenheimerFunds said they will work with Puerto Rico and its power authority, PREPA, on a revitalization plan after a U.S. appeals court on Monday affirmed a lower court decision to strike down a Puerto Rican legislation granting local municipalities the right to enter bankruptcy, Reuters reported yesterday. Franklin Advisers and OppenheimerFunds said that they expect to work with Puerto Rico to develop reforms that holders of its bonds can support. PREPA creditors Franklin Advisers and OppenheimerFunds are parties to a creditor forbearance agreement that protects PREPA from litigation until Sept. 15. Read more.
In related news, U.S. Representative Tom Marino (R-Pa.), chairman of a House subcommittee considering legislation that would allow Puerto Rico’s government agencies to seek bankruptcy protection, said he’s pushing for the measure to advance, Bloomberg News reported yesterday. The bill, which was the subject of a February hearing by Marino’s House Judiciary Subcommittee on Regulatory Reform, Commercial and Antitrust Law, hasn’t moved forward as lawmakers have raised objections and the island falls deeper into a fiscal crisis. Marino said discussions among House members are continuing over the legislation, which was introduced by Pedro Pierluisi, Puerto Rico’s nonvoting delegate to Congress. Read more.
