Mirant obtains court approval for $500 million DIP

By Carlise Newman

Chicago, Oct. 21 - Mirant Corp. obtained court approval for up to $500 million in debtor-in-possession financing.

The company will receive $200 million immediately from General Electric Capital Corp., a unit of General Electric Co. The company will receive an additional $100 million upon the final approval of its risk management practices by creditors groups or a general order by the court and may get another $200 million tranche to bring the total to $500 million.

Interest on the DIP is at Libor plus 350 basis points with a 75 basis points unused fee.

Closing will occur upon satisfaction of agreed documentary and other conditions including the entry by the Bankruptcy Court of a final order approving the terms of the DIP.

The DIP runs through September 2005.

Mirant will use the DIP for working capital purposes.

The Atlanta-based energy company holds $855 million of unencumbered cash in addition to the financing.

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