AUTHORIZES THE GOVERNMENT DEVELOPMENT BANK TO PROCEED WITH TITLE VI RESTRUCTURINGThe Puerto Rico Fiscal Agency and Financial Advisory Authority (“AAFAF”, by its Spanish acronym) and the Government Development Bank of Puerto Rico (“GDB”) announced that the Financial Oversight and Management Board for Puerto Rico (the “Oversight Board”) has authorized the GDB to pursue the restructuring of its debts under Title VI of the Puerto Rico Oversight, Management and Economic Stability Act (“PROMESA”) and certified GDB’s Restructuring Support Agreement (“RSA”) under the relevant provisions of Title VI. As set forth in the certification, such approval applies solely to the form of RSA as submitted to the Oversight Board. Consummation of the restructuring under the RSA is subject to the satisfaction of the further requirements of PROMESA.
“On behalf of AAFAF and the Administration, I want to express my deepest gratitude to GDB’s stakeholders who have worked tirelessly throughout this process. Today’s developments are the result of open dialogue, creativity and the willingness of all parties to reach a restructuring agreement that is fair to all parties,” said Gerardo José Portela Franco, Executive Director of AAFAF.
“Today’s development represents an important step forward in the restructuring of GDB. It also represents significant progress in Puerto Rico’s economic recovery. GDB would like to thank its stakeholders for their continued good faith negotiations and commitment to a consensual transaction,” said Christian Sobrino Vega, President of GDB.
GDB Amended Fiscal Plan
On April 28, 2017, the Oversight Board unanimously certified the Government Development Bank for Puerto Rico Fiscal Plan, dated April 28, 2017 (the “Original Fiscal Plan”). On June 30, 2017, AAFAF and GDB submitted to the Oversight Board for approval and certification an amended fiscal plan (the “Amended Fiscal Plan”). The amended plan, consistent with the strategy outlined in the Original Fiscal Plan, provides for the orderly wind-down of GDB’s operations while being updated to reflect the impact of the consensual restructuring transaction described in the Restructuring Support Agreements (collectively, the “RSA”).
Today, the Oversight Board unanimously adopted a resolution approving an Amended Fiscal Plan.
GDB Title VI Restructuring
As previously announced, AAFAF, GDB and certain of GDB’s financial creditors entered into the RSA providing for an organized, comprehensive and consensual restructuring of GDB under Title VI of PROMESA. On June 30, 2017, AAFAF requested that the Oversight Board certify the RSA as an Effective Voluntary Agreement and the restructuring transactions described in the RSA as a Qualifying Modification, in each case pursuant to PROMESA.
Today, the Oversight Board unanimously adopted a resolution certifying the RSA as an Effective Voluntary Agreement and the transactions described in the RSA as a Qualifying Modification, in each case pursuant to PROMESA.
This press release includes forward-looking statements, which include, but are not limited to, expectations with respect to the transactions described in the RSA. AAFAF and GDB cannot assure you that future developments affecting AAFAF, GDB, the RSA or the transactions described therein will be as anticipated. Actual results may differ materially from those expectations due to a variety of factors. Any forward-looking statement made in this release speaks only as of the date hereof and AAFAF and GDB do not undertake any obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise.