Dechert Secures US$8.5 Billion Victory for Municipal Bondholders in PREPA Utility Case
June 18, 2024
Dechert represented the municipal bondholders of the Puerto Rico Electric Power Authority (PREPA) in their successful case, reinstating the bondholders' claim for approximately US$8.5 billion, secured by all PREPA’s Net Revenues.
PREPA, an electric power company owned by the Commonwealth of Puerto Rico, is responsible for electricity generation, power distribution and power transmission on the island. The company began restructuring proceedings in 2017.
On Wednesday, June 12, a three-judge panel concluded that the language in a trust agreement governing the revenue bonds created a security interest in PREPA's net revenues. The decision also affirmed that the bondholders have a bankruptcy claim for the full amount of the bonds issued. The bankruptcy court will now determine the impact on the restructuring plan.
The Dechert team representing the municipal bondholders included financial restructuring partners G. Eric Brunstad Jr., Stephen D. Zide and David A. Herman. Mr. Brunstad argued it in the First Circuit.
About Dechert
Dechert is a global law firm that advises asset managers, financial institutions and corporations on issues critical to managing their business and their capital – from high-stakes litigation to complex transactions and regulatory matters. We answer questions that seem unsolvable, develop deal structures that are new to the market and protect clients' rights in extreme situations. Our nearly 1,000 lawyers across 20 offices globally focus on the financial services, private equity, private credit, real estate, life sciences and technology
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