Lonestar II Generation upsizes term loans, tightens OID to 99.75

By Sara Rosenberg

New York, Feb. 6 – Lonestar II Generation Holdings LLC lifted its incremental covenant-lite term loan B due April 18, 2026 to $60 million from $50 million and its incremental covenant-lite term loan C due April 18, 2026 to $7.2 million from $6 million, according to a market source.

Also, the original issue discount on the term loans was revised to 99.75 from talk in the range of 99 to 99.5, the source said.

Pricing on the incremental senior secured term loans is Libor plus 500 basis points with a 0% Libor floor.

The term loans have 101 soft call protection for six months, amortization of 1% per annum, an excess cash flow sweep of 100% for life and a six-month debt service reserve account requirement.

Morgan Stanley Senior Funding Inc. is the bookrunner on the deal.

Commitments were scheduled to be due at 5 p.m. ET on Thursday, the source added.

Allocations are expected on Friday.

Proceeds will be used to fund a cash collateralized letter-of-credit account, fund a distribution to the Lonestar Generation LLC balance sheet, and pay transaction fees and expenses.

Lonestar II Generation is the owner of a roughly 1.1 GW portfolio of three thermal power generation assets located in Texas and serving the ERCOT market.

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