Input on privatization of Puerto Rico power company sought
SAN JUAN – Puerto Rico’s government and Financial Management and Oversight Board on Tuesday announced they were seeking “input on the transformation” of the electrical system through “private ownership or operation” of the Puerto Rico Electric Power Authority (Prepa) assets, but that they were not ruling out other transformation alternatives.
A document released by the Private and Public Partnership Alliance Tuesday says Citigroup Global Markets Inc. and Rothschild & Co. have been retained as financial advisers in connection with a potential transformational transaction.
“All inquiries and requests should be submitted or directed to Citi and Rothschild. Under no circumstances should PREPA, the local Puerto Rican or Federal Government, the Oversight Board, or any of their affiliates be contacted directly,” the document reads.
The government is interested in selling Prepa’s power generation assets and in doing a transmission and distribution concession in which the system remains owned by the government but operated by a private investor. However, the document says the government is willing to examine other options for the public utility’s transformation.
“If alternative transformational structures are more attractive, Citi and Rothschild would be interested in exploring them, taking into account certain key objectives,” the document adds.
On Jan. 22, Gov. Ricardo Rosselló, announced his intent to privatize Prepa, which serves about 1.5 million customers on the island.
The transformation of the utility will take place in connection with Prepa’s ongoing Title III case under the Promesa law and according to legislation slated to be passed by the island’s legislature.