Gulf Pacific Power has closed a financing package for its purchase of the 745 MW Washington County simple-cycle gas-fired project in Linton, Ga.
MUFG was the lead arranger and bookrunner on the $259 million, seven-year debt package, which was signed on Nov. 30.
The debt package, arranged through a vehicle called Georgia Gulf Generating, comprises a $151 million term loan, two letters of credit totaling $101 million and a $7 million revolver.
Associated Bank, CoBank, DZ Bank, Helaba, Raymond James, Regions Bank, Siemens Financial Services and Zions Bank took part in the deal.
Gulf Pacific, which is a portfolio company of a fund managed by Harbert Management Corp.
on behalf of the California Public Employees' Retirement System
, used the proceeds to finance its purchase of the fully-contracted Washington County facility from Southeast PowerGen
on the same date (PFR, 5/4
The plant has tolling agreements with Central Georgia Electric Membership Corp. and Snapping Shoals Electric Membership Corp. through 2040 and with Georgia Power Co. through 2024.
Spokespeople for Harbert in Birmingham, Ala., and CalPERS in Sacramento, Calif., declined to comment and officials at MUFG in New York did not immediately respond to an inquiry.
GE gets out
The seller, Southeast PowerGen, was a joint venture between The Carlyle Group and GE Energy Financial Services before Nov. 30, when Carlyle Power Partners acquired GE EFS's 24.95% stake using some of the proceeds of the sale.
Southeast PowerGen used the rest of the $272 million proceeds to repay some of its term loan and reduce the amount of debt outstanding at project finance vehicle called Mackinaw Power, through which it used to own the Washington County project.
Spokespeople for GE EFS and Carlyle in New York declined to comment on the transactions, which were described in rating agency reports.
Southeast PowerGen put $197 million toward the repayment of its term loan, which is due in December 2021, leaving the outstanding principal under the loan at $224 million, according to a Nov. 29 report from Moody’s Investors Service. Moody’s upgraded SEPG’s credit rating from B1 to Ba3 as a result of the transactions.
A further $35 million is earmarked for the reduction of Mackinaw's $52.6 million senior secured debt pile through a debt exchange.
The new notes will have the same 6.3% coupon as the old notes and will fully amortize in 2023, as before. Only the principal will be reduced.
S&P Global Ratings assigned the new Mackinaw notes a preliminary BBB+ rating on Nov. 29. Moody’s rates the existing debt Baa3.
Peach state portfolio
Mackinaw's remaining assets following the sale of Washington County are the 309 MW Monroe and 465 MW Walton gas-fired units in Georgia (PFR, 3/10/17
Their output is contracted with Georgia Power under fixed-price tolling agreements through May 2024, six month after the Mackinaw debt is due to mature.
Besides the remaining Mackinaw pair, SEPG also owns three unencumbered assets in Georgia. They are:
- the 677 MW Sandersville simple-cycle facility in Washington County, which has two tolling agreements totaling 300 MW with Morgan Stanley Capital Group through 2025 and 2030 respectively;
- the fully merchant 527 MW Effingham combined-cycle unit in Rincon; and
- the 330 MW Mid-Georgia topping-cycle cogeneration project in Kathleen, which is contracted with Georgia Power through 2028.