Energy Capital affiliate obtains $950 million bridge loan via Barclays for Calpine buyout

By Marisa Wong

Morgantown, W.Va., Aug. 22 – An Energy Capital Partners III, LLC affiliate has obtained debt financing commitments to finance its acquisition of Calpine Corp. Barclays Bank plc has agreed to provide committed financing of up to $950 million under a 364-day bridge loan facility to Volt Parent, LP, according to an 8-K filed Tuesday with the Securities and Exchange Commission.

Energy Capital Partners and other members of a consortium have committed to provide capital to Volt with an aggregate equity contribution of $5,187,000,000 to help finance the merger.

Barclays’ commitment is intended to bridge a portion of Energy Capital Partners’ equity commitment.

In addition, in connection with the merger, Calpine will seek an amendment to its credit agreement dated Dec. 10, 2010 with MUFG as administrative agent and MUFG Union Bank, NA as collateral agent.

Barclays has agreed to provide committed financing of $1.1 billion to amend and restate, refinance or otherwise replace that existing revolving credit agreement in the event the amendment is not effected.

Barclays’ obligation to provide debt financing under the Volt bridge loan and the Calpine revolver is subject to a number of conditions, the filing noted.

Calpine is a Houston-based generator of electricity from natural gas and geothermal sources. Energy Capital Partners is a private equity firm based in Short Hills, N.J.

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