American National Power credit facility launch expected early June

By Sara Rosenberg

New York, May 12 - American National Power Inc. is expected to hold a bank meeting for its proposed credit facility in early June, according to a market source.

Credit Suisse and Goldman Sachs are joint leads on the deal.

Proceeds will be used to help fund the $1.14 billion acquisition of the 632 megawatt coal-fired Coleto Creek Power generation facility from Topaz Power Group.

There are no specific details available yet on the loan size, the source said.

However, in the acquisition announcement, it was said that the actual purchase and working capital requirements will be funded by a fully underwritten non-recourse debt facility of $935 million.

In addition, American National's parent company, International Power plc, will contribute $288 million toward the purchase that will come from the current liquid resources.

The majority of Coleto Creek's output is forward contracted to 2009. Additional forward contracts have been agreed upon and will be put in place through to 2013 for about 50% of the plant's output. The credit support required for these forward hedging arrangements will be provided within the financing facility.

The acquisition is subject to regulatory approval and is expected to be completed in the third quarter.

International Power is a London-based independent electricity generating company, and American National Power is the company's wholly owned subsidiary with operations in the United States.

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