The bookrunners on a proposed term loan B repricing for Atlantic Power Corp. have approached lenders with initial price thoughts.
Goldman Sachs is left lead on the $380 million three-year deal, which was launched on Jan. 17. The senior secured notes are issued through a holding company called APLP Holdings.
Following a lender call on Jan. 21, the bookunners set IPTs at 250 basis points over Libor, which would represent a cut to the margin on the existing loan of 25 bp.
The repriced notes are being pitched at a discount of between 99.875 and par. Commitments are due by Jan. 28.
The maturity date of the loan will remain unchanged at April 2023 (PFR, 10/24/18).
Bank of America, Industrial and Commercial Bank of China, MUFG, RBC Capital Markets and Wells Fargo retain their roles as joint-bookrunners (PFR, 10/22/18).
Existing holders of the loan include CVC Credit Partners, Nassau Reinsurance Group and Pretium Partners.
Latham & Watkins and Norton Rose Fulbright are serving as legal advisers on the transaction.
The senior secured loan is rated Ba2 by Moody’s Investors Service and BB by S&P Global Ratings, which raised its rating from BB- on Dec. 13. Moody’s and S&P rate parent company Atlantic Power at Ba3 and B+, respectively.
Atlantic Power owns stakes in 21 operational plants—mostly gas-fired and biomass—in the U.S. and Canada.
The plants have a total combined gross capacity of 1.9 GW, of which Atlantic Power's stakes represent about 1.4 GW (see table).
Atlantic Power is expecting to net approximately $45 million from the sale of one of the assets in 2022, which it has said it will use to pay down a portion of the loan. The project being sold is the 300 MW Manchief gas-fired plant in Morgan County, Colo. The buyer is the plant's offtaker, Xcel Energy (PFR, 5/28/19)
“With 1,484 MW of net generation capacity, Atlantic Power is one of smallest rated independent power producers,” noted Moody’s analysts in an Oct. 2019 credit report. “For many of Atlantic Power's projects, the PPAs were signed more than a decade ago and are at the later stages of their contract lives; average remaining PPA life is approximately 5.9 years.”