Kelson to launch $1.51 billion credit facility Wednesday

By Sara Rosenberg

New York, Feb. 9 - Kelson Holdings LLC is scheduled to hold a bank meeting on Wednesday to launch its proposed $1.51 billion senior secured credit facility, according to a market source.

Merrill Lynch is the bookrunner and lead arranger on the deal.

The facility consists of a $50 million revolver, a $990 million first-lien term loan and a $470 million second-lien term loan, the source said, adding that price talk is not yet available.

Proceeds from the credit facility, along with $160 million of mezzanine debt, will be used for a recapitalization that will involve the repayment of substantially all of the company's existing indebtedness and the formation of a new holding company, which will own four power plants in the south central United States.

Kelson, a company wholly owned by Harbinger Capital Partners, is a holding company established for the management and ownership of certain power plants.

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