Summary
Exelon Corporation's subsidiary, Exelon Generation Company, LLC, has announced the sale of $900 million in Senior Notes. These notes are comprised of $550 million maturing in 2020 with a 4.00% coupon and $350 million maturing in 2041 with a 5.75% coupon. The primary purpose of this financing is to fund a portion of the acquisition of John Deere Renewables, LLC, a wind electric generating facilities owner and operator. This transaction is a key step in Exelon's strategic expansion into renewable energy, specifically wind power. Investors should note the mandatory redemption clause for the 2020 Senior Notes, which requires a redemption at 101% of the principal if the acquisition is not completed or the purchase agreement is terminated by March 31, 2011. This provides a degree of protection for noteholders in the event the acquisition falls through.
Key Highlights
- 1Exelon Generation Company, LLC is issuing $900 million in Senior Notes.
- 2The notes consist of $550 million maturing in 2020 (4.00% coupon) and $350 million maturing in 2041 (5.75% coupon).
- 3Proceeds will primarily fund the acquisition of John Deere Renewables, LLC's wind power assets.
- 4The acquisition involves 735 megawatts of operating wind electric generating facilities.
- 5The 2020 Senior Notes have a mandatory redemption provision if the acquisition is not completed or the purchase agreement is terminated by March 31, 2011.
- 6The redemption price for the 2020 Senior Notes, if triggered, would be 101% of the principal plus accrued interest.
- 7The closing of the Senior Notes sale is expected on September 30, 2010.