More than 300 participants ranging from institutional investors to hedge funds to bond insurers are scheduled to attend today’s presentation in New York explaining why Puerto Rico cannot repay all of its obligations on time, Bloomberg News reported yesterday. Complicating matters is a push by commonwealth officials to seek federal assistance and even changes in bankruptcy laws. “It will be a very protracted battle given Puerto Rico lacks a mechanism for restructuring like Chapter 9,” said Peter Hayes, head of municipal debt at BlackRock Inc., which manages $114 billion of the securities, including Puerto Rico debt. “There is likely to be a multitude of lawsuits given the unlikely event creditors are acceptable to terms to be proposed by Puerto Rico.” Governor Alejandro Garcia Padilla said in a June 29 televised speech that he will seek to postpone debt repayment for “a number of years,” and directed island officials to craft a restructuring plan by Aug. 30. A report from three former International Monetary Fund economists made public last week suggests that Puerto Rico swap current bonds for new ones with later maturities and lower payments. The report will serve as a focal point during the 3 p.m. meeting at Citigroup Inc.’s offices on Park Ave.
