CenterPoint Energy, units extend revolvers to 2018, amend covenants

By Marisa Wong

Madison, Wis., Sept. 10 - CenterPoint Energy, Inc. and wholly owned subsidiaries CenterPoint Energy Houston Electric, LLC (CEHE) and CenterPoint Energy Resources Corp. (CERC) amended their three revolving bank credit facilities dated Sept. 9, 2011, according to a press release.

Specifically, CenterPoint extended the maturity date of each of the facilities to Sept. 9, 2018 from Sept. 9, 2016.

In addition, the debt-to-EBITDA financial covenant in CenterPoint's facility has been replaced with a debt-to-capitalization financial covenant.

Aggregate commitments under CERC's facility have been reduced to $600 million from $950 million. Total commitments under the CenterPoint and CEHE facilities remain at $1.2 billion and $300 million, respectively.

According to an 8-K filing with the Securities and Exchange Commission, CenterPoint also amended some provisions under each of the facilities related to the determination of Libor.

Based on current credit ratings, the CenterPoint Energy and CERC facilities have a drawn cost of Libor plus 150 basis points, and the CEHE facility has a drawn cost of Libor plus 125 bps, the release noted.

"I am pleased that we have been able to lock in the short-term liquidity provided by these facilities for the next five years, and gratified that each of the banks in our facilities has agreed to the amendments and extensions we sought," Gary L. Whitlock, executive vice president and chief financial officer of CenterPoint, said in the release. "These appropriately sized and competitively priced facilities allow the company to strengthen its liquidity and enhance its financial flexibility."

The amendments and extensions of the three facilities were coordinated by J.P. Morgan Securities LLC and Citigroup Global Markets, Inc., which together with RBS Securities Inc., Merrill Lynch, Pierce, Fenner & Smith Inc., Barclays, Deutsche Bank Securities Inc. and Wells Fargo Securities LLC are the joint lead arrangers and joint bookrunners for the facilities. JPMorgan Chase Bank, NA is the administrative agent for CenterPoint and CEHE's facilities, and Citibank, NA is the administrative agent for CERC's facility.

The energy company is based in Houston.

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