LS Power downsized $750 million term loan prices wide of discount talk

By Paul A. Harris

Portland, Ore., June 28 - LS Power Development, LLC priced a downsized $750 million seven-year first-lien term loan (Ba2/BB+) at 97.5, according to an informed source. The interest rate is Libor plus 425 basis points.

The deal allocated and broke for trading. It was downsized from $800 million.

The original issue discount came wider than price talk that had already widened to 98 from 981/2.

The loan has a 1.25% Libor floor and soft call protection of 102 in year one and 101 in year two.

Credit Suisse Securities (USA) LLC, Citigroup Global Markets Inc. and Morgan Stanley Senior Funding Inc. are the lead banks on the deal.

Proceeds will be used to refinance existing project level debt, to fund reserve accounts, to fund a one-time distribution to the sponsor and for general corporate purposes.

The issuer is LSP Madison Funding LLC.

LS Power is a New York-based company that has a diversified portfolio of power generating facilities.

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