Talen Energy successfully completes restructuring transactions

By William Gullotti

Buffalo, N.Y., May 17 – Talen Energy Corp. consummated the strategic transactions contemplated by its Chapter 11 reorganization plan and completed its restructuring, according to a press release on Wednesday.

The plan included new equity capital under a $1.4 billion common equity rights offering. In addition, Talen Energy Supply LLC raised almost $3.03 billion in funding, composed of:

• A $700 million revolving credit facility;

• The previously reported $1.2 billion private offering of 8.625% senior secured notes due 2030;

• The previously reported $580 million term loan B credit facility;

• A $470 million term loan C facility; and

• A $75 million bilateral line of credit.

Also included in the plan was the full repayment of Talen Energy Supply’s formerly existing first-lien funded debt and the consensual equitization of all of the Talen Energy Supply’s formerly existing unsecured notes. Said transactions resulted in an about $2.7 billion debt reduction.

As a result, the company is emerging with about $875 million of liquidity consisting of cash on hand and undrawn funds in its revolving credit facilities.

As previously reported, Mark “Mac” McFarland succeeded Alejandro “Alex” Hernandez as chief executive officer with the plan’s consummation. He has also assumed the role of company president and will serve as member of the company’s reconstituted board of directors.

Likewise, with the consummation of the plan, Stephen Schaefer has assumed his role as chairman of the reconstituted board of directors of the company, as have the company’s reconstituted board of directors: Gizman Abbas, Anthony Horton, Karen Hyde, Joseph Nigro and Christine Schwartzstein.

Details regarding the aforementioned credit facilities were not disclosed in the press release.

Houston-based Talen Energy Supply is one of the largest competitive power generation and infrastructure companies in North America. The company filed bankruptcy on May 9, 2022 under Chapter 11 case number 22-90054.

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