Capstone Infrastructure Corporation recently announced it has completed the previously announced approximately $100 million debt offering by a wholly-owned subsidiary entity of the Corporation comprising $80.4 million of senior secured bonds and $20.2 million of subordinated secured bonds (collectively, the “Bonds”) to recapitalize its hydro power facilities.Following the repayment of the approximately $27 million levelization debt balance at the Wawatay hydro facility along with transaction-related costs, the net proceeds of the financing are approximately $72 million. In addition, the Corporation has established debt service and maintenance reserve accounts, which are initially cash funded, in the amount of $4 million. As a result, approximately $68 million of the net proceeds from the financing will be used to repay a portion of the approximately $80 million outstanding on the Corporation’s CPC-Cardinal credit facility, which matures on September 28, 2012. The senior secured and subordinated secured bonds are fully amortizing with 28-year and 29-year terms, and bear interest at fixed rates of 4.6% and 7.0%, respectively. The Bonds are secured by the hydro power facilities alone and are non-recourse to the Corporation’s other businesses.The Corporation is currently finalizing a new corporate credit facility with its existing lenders to refinance the remaining approximately $12 million outstanding under the CPC-Cardinal credit facility.TD Securities Inc. acted as sole arranger on the private placement of the Bonds.
Source:Business Wire
