Moody’s rates ExGen Renewables loan Ba2

Moody's Investors Service said it assigned a Ba2 rating to ExGen Renewables IV, LLC's (EGR IV) $750 million seven-year senior secured term loan.

The outlook is stable.

The financing represents a recapitalization of Exelon Generation Co., LLC's (ExGen, Baa2 stable) renewable energy portfolio totaling about 1 GW (net ownership adjusted) of solar, wind and biomass power projects.

Net debt proceeds are expected to fund an equity distribution to ExGen, fund reserves, and pay transaction costs.

Moody’s said the “Ba2 rating is supported by long-term contracted cash flows with mostly creditworthy entities, a broad portfolio of projects spanning across multiple renewable energy resources, and at least several years of operating history for most of the underlying assets.”

“Ownership by a strategic sponsor, use of mostly proven technology, and project finance features are positives.

“Debt protections include a cash funded six-month debt service reserve, an excess cash sweep, and collateral in the borrower's assets comprising mainly of stock of subsidiaries,” Moody’s added in a news release.

“The borrower's liquidity is further supported by a $20 million liquidity reserve.”

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