Allegheny $1.6 billion credit facility to launch Thursday

By Sara Rosenberg

New York, Feb. 11 - Allegheny Energy Inc. is scheduled to hold a bank meeting on Thursday morning for a proposed $1.6 billion credit facility, according to a source close to the deal. Citigroup and Bank of America are the lead banks on the transaction.

The facility will be presented to lenders as an $800 million seven-year first lien term loan with price talk of Libor plus 300 to 325 basis points, a $500 million 71/4-year second lien term loan with price talk of Libor plus 450 to 475 basis points and a $300 million three-year revolver with price talk of Libor plus 300 basis points, according to the source.

Proceeds will be used to repay and refinance all the company's bank debt that was restructured in February 2003.

The Hagerstown, Md., energy company's new facility is expected close by the end of the month.

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