Calpine closes on $1.6 billion secured credit facility

By Sara Rosenberg

New York, March 12 - Calpine Corp. announced on Tuesday it closed on a $1.6 billion secured credit facility. The banks involved in the new credit facility are The Bank of Nova Scotia, Citibank, Bank of America, Bayerische Landesbank Girozentrale, Credit Suisse First Boston, Deutsche Bank, The Toronto-Dominion Bank and ING Barings.

The loan includes a new $1 billion revolver that will expire on May 24, 2003 and a new $600 million term loan that will mature in two years. Included in the company's debt is an amended $400 million revolving credit facility that will also expire on May 24, 2003, providing Calpine with a total of up to $2 billion in credit.

Pricing on the revolver is Libor plus 200 basis points. The term loan is priced at Libor plus 275 basis points.

"This substantially expanded facility is an important step in our continuing program to strengthen Calpine's liquidity," said Pete Cartwright, chairman and chief executive officer of Calpine, in a press release. "We're committed to building a substantial liquidity cushion, and we have made significant progress towards this goal."

Security for the $2 billion credit includes Calpine's North American gas properties, the Saltend power plant in the United Kingdom and Calpine's equity investment in nine U.S. power plants. According to Bob Kelly, president of Calpine Finance, the estimated value on the assets put up for security is $4 billion.

Proceeds will be used towards capital expenditures and other general purposes.

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