Headline: Facing a Hit Over Debt in Alabama
In a move to avoid the largest municipal bankruptcy in U.S. history, holders of more than $3 billion in debt issued by Jefferson County, Ala., are working on a rescue that would leave them with steep losses.
The offer calls for bondholders to forgive about $1 billion of the $3.14 billion in sewer debt owed by Alabama's most populous county, which has about 665,000 residents, a person familiar with the matter said.
Banks, hedge funds and mom-and-pop investors that own the sewer bonds are scrambling to agree on concessions before a Thursday meeting, where officials in Jefferson County, which includes Birmingham, might decide to file for bankruptcy.
As of late Tuesday, the situation remained fluid, and it was possible the last-ditch offer would fall apart.
John S. Young, a court-appointed receiver who is participating in the talks, said bondholders still "have a way to go."
The deal being worked on also includes money that would be set aside to help struggling Jefferson County residents pay their sewer bills, a person familiar with the matter said.
Source: finance.yahoo.com
