The term loans for the former TECO Panda held their ground in the 184-185 context last Tuesday but eased down to around 181-182 by Thursday, according to dealers. The moves followed the announcement Credit Suisse, Lehman Brothers and Goldman Sachs are refinancing the debt for the power company which is now known as Entegra Power Group. A shareholder meeting was held last Thursday to present the new $1.33 billion credit facility, according to Joff Mitchell, ceo at Entegra. The deadline to approve the financing is Feb. 27, he noted.
The deal consists of a seven-year, $450 million cash-pay second-lien "B" term loan; a seven-year, $30 million second-lien revolver and an eight-and-a-half-year, $850 million third lien that is payment-in-kind, Mitchell said. He declined to comment on pricing but said choosing the underwriters was a very competitive process resulting in competitively priced paper and that CS, Lehman and Goldman came out with the best deal. "The market is very frothy at the moment and we expect a great result," he said.
The term loans have been rising steadily since November and its Gila River term loan "B" jumped from the mid 170s to the low to mid 180's around Feb. 8, according to Markit data.
Entegra was formed in June 2005 and owns two of the largest power plants in the U.S. - Gila River Power Station in Arizona and the Union Power Station in Arkansas. The plants were a joint venture between TECO Wholesale Generation, known at the time as TECO Power Services Corp. and Panda Energy International.