Calpine tenders for part of its 9¾% notes

By Jennifer Chiou

New York, July 7 - Calpine Construction Finance Co., LP announced a tender offer for a portion of its outstanding 9¾% second-priority senior secured floating-rate notes due 2011.

The company will purchase notes tendered before midnight ET on Aug. 3 at par plus accrued interest up to and including the purchase date using the anticipated $225 million proceeds from its already announced potential sale of the Ontelaunee Energy Center.

Calpine must first offer to repay $379.2 million outstanding under its term loans before repurchasing any notes. Notes will only be repurchased if any of the bank lenders decline the repayment.

Calpine Construction Finance, an indirect wholly owned subsidiary of San Jose, Calif.-based Calpine Corp., owns and operates seven natural gas-fired combined cycle power plants.

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