Swiss Insured Brazil Power starts redemption solicitation for 9.85% notes

Chicago, Sept. 13 – Swiss Insured Brazil Power Finance Sarl started a consent solicitation for its 9.85% senior secured notes due 2032 (ISINs: L8915MAA3, 870880AA9), according to a press release.

There are currently R$2,669,810,887.50 of the notes outstanding.

The issuer plans to hold noteholder meetings to amend the debenture to include a new put option so that guarantor Celse – Centrais Eletricas de Sergipe SA may repurchase all of the debentures, a put option that would be triggered by Celse’s issuing a prepayment notice to senior lenders. Additionally, the company wants a waiver in the indenture to allow Celse to incur debt to fund the purchases, repayments and redemptions described in the consent solicitation statement.

The senior lenders referred to are Inter-American Investment Corp. and the International Finance Corp.

The company would also need to work on a similar change to the loan agreements to permit the debt and the repayments.

The repurchase price would be the lesser of par or the sum of the remaining principal and interest payments discounted on a semiannual basis at the BRL National Treasury Note due Jan. 1, 2029 less accrued and unpaid interest to the repurchase date.

The solicitation will expire at 5 p.m. ET on Sept. 20, also the final revocation time.

The company is willing to pay two consent payments, in both cases multiplied by an 83.3925% scaling factor and based on R$1,000 debentures.

The first R$5.00 (before scaling) consent effectiveness payment will be made on the initial settlement date, expected to be within three business days after all conditions of the solicitation have been satisfied. The second R$25.00 (also to be scaled) additional consent consideration will be paid at the earlier of 20 business days following the expiration time or the business day before the notes are scheduled to be redeemed.

The consent considerations are denominated in reais but will be settled in dollars, with the conversion rate determined at 4 p.m. ET on the business day after the expiration time.

The scaling factor reflects the fact that the notes are subject to principal amortization.

Citigroup Global Markets Inc. is the sole structuring and lead solicitation agent (212 723-6106, 800 558-3745, ny.liabilitymanagement@citi.com).

Banco Bradesco BBI SA (+55 11 3847 5610), Banco BTG Pactual SA – Cayman Branch (212 293-4600, ol-dcm@btgpactual.com), Itaú BBA USA Securities, Inc. (212 824-5083) and Santander US Capital Markets LLC (855 404-3636) are co-solicitation agents

D.F. King & Co., Inc. is the information agent (800 290-6427, 212 269-5550, celse@dfking.com).

Swiss Insured Brazil Power is a Luxemburg special purpose vehicle issuing debt for Celse, a Brazilian company engaging in power generation from natural gas thermal plants.

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