Talen Energy Supply, LLC Announces $525 Million Cash Tender Offers to Purchase Certain of its Outstanding Unsecured Debt Securities and Related Consent Solicitations
THE WOODLANDS, Texas, May 7, 2019 /PRNewswire/ -- Talen Energy Supply, LLC (the "Company" or "Talen Energy Supply") announced today that it has commenced tender offers (the "Tender Offers") to purchase for cash upon the terms and subject to the conditions described in the Offer to Purchase (as defined below) up to an aggregate purchase price of $525,000,000 (excluding unpaid interest from the applicable last interest payment date to, but not including, the applicable settlement date (subject to increase or decrease by the Company in its sole discretion, the "Aggregate Maximum Tender Amount")) of its 4.600% Senior Notes due 2021 (the "2021 Notes"), 9.500% Senior Notes due 2022 (the "2022 Notes") and 6.500% Senior Guaranteed Notes due 2024 (the "2024 Notes" and, together with the 2021 Notes and the 2022 Notes, the "Securities"). The following table sets forth certain terms of the Tender Offers:
Dollars per $1,000 Principal
Amount of Securities
Title of
CUSIP/ISIN
Principal
Acceptance
Tender Offer
Consent
Total
Security Number Amount Priority Consideration(1) Payment(1) Consideration(1)(2)
Outstanding Level
4.600%
69352JAN7 $143,753,000 1 $965.00 $50.00 $1,015.00
Senior
Notes due
2021
US69352JAN72
---
9.500% $392,679,000 2 $1,065.00 $50.00 $1,115.00
Senior
Notes due
2022
87422VAB4
US87422VAB45
USU8302WAA28
---
87422VAC2 $83,317,000 3 $850.00 $50.00 $900.00
6.500%
Senior
Guaranteed
US87422VAC28
Notes due
2024
USU8302WAB01
---
(1) Per $1,000 principal amount of Securities validly tendered and accepted for purchase
(2) Includes Consent Payment
In connection with the Tender Offers, the Company is concurrently soliciting consents (the "Consent Solicitations") of the holders of the Securities to the adoption of certain amendments (the "Proposed Amendments") to the indentures governing the Securities (the "Existing Notes Indentures") to eliminate substantially all of the restrictive covenants, as well as certain events of default and related provisions contained in the applicable Existing Notes Indenture. The Proposed Amendments require the consents (the "Requisite Consents") of holders of at least a majority in outstanding principal amount of the applicable Securities. Holders who tender outstanding Securities pursuant to the Tender Offers will also be providing consents with respect to the applicable Proposed Amendments.
The Company intends to fund the purchase of the Securities with the concurrent offering of its Senior Secured Notes due 2027 that it anticipates will result in its receipt of net cash proceeds which, together with cash on hand (if necessary), will be sufficient to fund the aggregate Total Consideration and Accrued Interest for all Securities tendered and not validly withdrawn pursuant to the Tender Offers and Consent Solicitations and accepted for purchase by the Company, subject to the terms and conditions of the Tender Offers and Consent Solicitations (the "Financing Transaction"). The Financing Transaction will be made in reliance on exemptions from the registration requirements of the Securities Act of 1933, as amended. The Tender Offers and Consent Solicitations are subject to the satisfaction of the conditions described in the Offer to Purchase, including the consummation of the Financing Transaction. Such conditions may be waived by the Company in its sole discretion, subject to applicable law. Any waiver of a condition by the Company will not constitute a waiver of any other condition.
Subject to the Aggregate Maximum Tender Amount and proration, the amount of a series of Securities that is purchased in the Tender Offers will be based on the order of priority (the "Acceptance Priority Level") for such series of Securities set forth in the table above. The Tender Offers and Consent Solicitations are not contingent upon the tender of any minimum principal amount of Securities and the purchase of one series of Securities is not conditioned on the purchase of any other series of Securities.
This announcement does not contain the full terms and conditions of the Tender Offers and Consent Solicitations, which are contained in the offer to purchase for cash and solicitation of consents, dated May 7, 2019 (as it may be amended or supplemented, the "Offer to Purchase"). The Company refers investors to the Offer to Purchase for the complete terms and conditions of the Tender Offers and Consent Solicitations.
The Tender Offers and Consent Solicitations will expire at 11:59 p.m., New York City time, on June 4, 2019 (such date and time, as it may be extended, the "Expiration Date"), unless earlier terminated.
The "Total Consideration" for each $1,000 principal amount of Securities validly tendered at or prior to 5:00 p.m., New York City time, on May 20, 2019 (such date and time, as it may be extended, the "Consent Date") and accepted for purchase pursuant to the Tender Offers will be the applicable total consideration for such series of Securities set forth in the table above, which is inclusive of an amount in cash equal to the amounts set forth in the table above under the heading "Consent Payment" (the "Consent Payment"). Holders of Securities (collectively, the "Holders") who validly tender their Securities after the Consent Date but at or prior to the Expiration Date will only be eligible to receive an amount equal to the Total Consideration minus the Consent Payment (the "Tender Offer Consideration").
Tendered Securities may be withdrawn and related consents may be revoked from the Tender Offers and Consent Solicitations at or prior to, but not after, 5:00 p.m., New York City time, on May 20, 2019 (the "Withdrawal Deadline").
Subject to the Aggregate Maximum Tender Amount and proration, all Securities tendered at or before the Consent Date having a higher Acceptance Priority Level will be accepted before any Securities tendered at or before the Consent Date having a lower Acceptance Priority Level are accepted, and all Securities validly tendered after the Consent Date having a higher Acceptance Priority Level will be accepted before any Securities tendered after the Consent Date having a lower Acceptance Priority Level are accepted in the Tender Offers. However, if the Tender Offers are not fully subscribed as of the Consent Date, subject to the Aggregate Maximum Tender Amount, Securities tendered at or before the Consent Date will be accepted for purchase in priority to Securities tendered after the Consent Date, even if such Securities tendered after the Consent Date have a higher Acceptance Priority Level than Securities tendered prior to the Consent Date. If there are sufficient remaining funds to purchase some, but not all, of the Securities of any series, the amount of Securities purchased in that series may be subject to proration.
In the event of any proration of a series of Securities, the consents delivered with respect to such series of Securities shall be null and void and the Requisite Consents will be deemed not to have been obtained with respect to such series of Securities.
Following the completion of the Tender Offers and Consent Solicitations, the Company or its affiliates may purchase additional Securities in the open market, in privately negotiated transactions, through tender or exchange offers, or otherwise, or the Company may redeem Securities that the Company is permitted to redeem pursuant to their terms. The Company is not obligated to redeem any Securities that are not tendered and accepted in the Tender Offers and Consent Solicitations.
Information Relating to the Tender Offers and Consent Solicitations
The Offer to Purchase for all of the Securities is being distributed to Holders beginning today. Credit Suisse Securities (USA) LLC is the Dealer Manager and Solicitation Agent for the Tender Offers and Consent Solicitations. Investors with questions regarding the Tender Offers and Consent Solicitations may contact Credit Suisse Securities (USA) LLC at (212) 325-2476 (New York) or (800) 820-1653 (U.S. toll free). Global Bondholder Services Corporation is the Tender Agent for the Tender Offers. Copies of the Offer to Purchase and any related offer documents may be obtained by contacting Global Bondholder Services Corporation by phone at (212) 430-3774 (New York) or (866) 794-2200 (toll-free) or by email at contact@gbsc-usa.com.
None of the Company, its direct parent company, Talen Energy Corporation, or its affiliates, their respective boards of directors, shareholders and members, the Dealer Manager and Solicitation Agent, the Tender Agent or the Bank of New York Mellon, as trustee for each of the Securities is making any recommendation as to whether Holders should tender any Securities and deliver related consents in response to the Tender Offers and Consent Solicitations. Holders must make their own decision as to whether to tender any of their Securities, and, if so, the principal amount of Securities to tender.
This press release is for informational purposes only and is not an offer to buy or a solicitation of an offer to sell any of the Securities or the new senior secured notes or a solicitation of consents, and the Tender Offers and Consent Solicitations do not constitute offers to buy or the solicitation of offers to sell Securities or the solicitation of consents in any jurisdiction or in any circumstances in which such offers or solicitations are unlawful. The full details of the Tender Offers and Consent Solicitations, including complete instructions on how to tender Securities, are included in the Offer to Purchase. Holders are strongly encouraged to read carefully the Offer to Purchase because it will contain important information.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company. These risks include, but are not limited to, the Company's ability to complete any of the Tender Offers and Consent Solicitations and reduce its outstanding indebtedness. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in the forward-looking statements. The forward-looking statements in this press release are made as of the date hereof, and the Company does not undertake any obligation to update the forward-looking statements as a result of new information, future events or otherwise.
About Talen Energy Supply
Talen Energy Supply is one of the largest competitive energy and power generation companies in North America. The Company owns or controls approximately 15,000 megawatts of generating capacity in well-developed, structured wholesale power markets, principally in the Northeast, Mid-Atlantic and Southwest regions of the United States.
Investor Contacts
Stacey Peterson
Senior Vice President, Treasurer, and Head of Investor Relations
Stacey.Peterson@talenenergy.com
Ryan Koren
Senior Manager, Investor Relations and FP&A
610-601-0477
Ryan.Koren@talenenergy.com
Media Contact
Taryne Williams
Media & Community Relations Manager
610-601-0327
Taryne.Williams@talenenergy.com
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SOURCE Talen Energy Supply
