TES Debentureholders have entered into a Standby Undertaking with respect to a common stock rights offering of $1.3 billionwith option to extend the rights offering to $1.65 billion, as part of the previously announced Restructuring Support Agreement (“RSA”). Additionally, TES unsecured noteholders holding over 71% of the unsecured notes have signed the RSA, achieving another significant milestone.
HOUSTON, June 3, 2022 /PRNewswire/ — Talen Energy Corporation (“TEC”) today announced that subsidiary Talen Energy Supply (“TES” or “the Company”) has achieved two significant milestones outlined in its Restructuring Support Agreement (” RSA”), originally announced on May 9.
TES and certain members of an ad hoc group of its debentureholders (the “Supporting Parties”) have successfully finalized a Letter of Commitment Supporting a Share Rights Offering ordinary of $1.3 billionwith the possibility of increasing the offer of rights up to $1.65 billion subject to certain closing adjustments as set forth in its RSA.
In addition, TES has received signatures on the RSA from holders of the Company’s unsecured notes holding more than 71% of the principal amount of the Company’s unsecured notes (the “Consenting Holders”) satisfying the step required under the RSA to obtain RSA support from ticket holders. holding at least 2/3 of the Company’s unsecured notes. Under the RSA, willing bondholders agreed to privatize more than $1.4 billion unsecured notes following the restructuring process. The $1.3 billion the backstop in equity, as well as the debt to be raised and the cash available on the balance sheet at the end of the restructuring process, will enable TES to eliminate $3.2 billion debt and maximize stakeholder value.
“Achieving these two key milestones represents another milestone as we strategically reposition TES for long-term value creation. The engagement of the Supporting Parties will contribute to both balance sheet repair and the provision of capital to ensure the long-term success of Talen.-The Cumulus platform and our people.These developments will allow us to create a solid capital structure adapted to today’s commodity market, position the company for growth and continue to build on the many operational accomplishments we have made in recent years,” said Director Executive Officer Alejandro “Alex” Hernandez.
Financial director John Chesser said, “With leading decarbonized nuclear and baseload generation assets critical to grid resilience, and Cumulus’ growing investment in energy transition growth projects, TEC’s transformation will create significant value creation opportunities to be future shareholders of TES – for their partnership, trust and support as we move Talen forward.”
On May 9in order to effect the consensual restructuring contemplated by RSA, TES and certain of its subsidiaries have voluntarily filed for reorganization under Chapter 11 of the United States Bankruptcy Code with the United States Bankruptcy Court for the Southern District of Texas. In accordance with the RSA, the Company expects to confirm its reorganization plan approximately six months after the start of its restructuring.
The restructuring cases are pending before the Honorable Marvin Isgur and are being jointly administered under Case No. 22-90054. Talen Energy Corporation, Cumulus Growth subsidiaries, LMBE-MC Holdco II LLC and its subsidiaries, and Talen Receivables Funding (TRF) are not part of the record. For more information, visit https://www.talenenergy.com/maximizing-value-for-our-stakeholders/.
Court documents and other information are available on a website hosted by TES’ claims agent, Kroll, at https://cases.ra.kroll.com/talenenergy. TES has also set up a call center for questions at 844-721-3899 if calling from within. United States Where Canada or 347-292-4080 if calling from outside these areas. Creditor inquiries may also be directed to [email protected].
TES retained Weil Gotshal & Manges LLP as legal advisor, Evercore as investment banker and Alvarez & Marsal as financial advisor for its restructuring. Consenting noteholders are represented by Kirkland & Ellis LLP and Rothschild & Co US Inc.
About Talen Energy Corporation
Talen Energy Corporation, through its subsidiary TES, is one of the largest competitive power generation and infrastructure companies in North America. TES owns and/or controls approximately 13,000 megawatts of generating capacity in wholesale electricity markets in the United States, primarily in the Mid-Atlantic, Texas and Montana.
Through its subsidiary, Cumulus Growth, Talen Energy Corporation is developing a large-scale portfolio of renewable energy, battery storage and digital infrastructure assets across its vast footprint. For more information, visit https://www.talenenergy.com/esg-focused-future/.
Corporate Communication Director
610-601-0327, [email protected]
SOURCE Talen Energy Corp.
SOURCE Talen Energy Corp.