Summary
Exelon Corporation, through its subsidiary Constellation NewEnergy, Inc. (CNE), has entered into a new $750 million Receivables Facility with MUFG Bank and other financial institutions. This facility allows CNE to sell certain trade receivables to a special purpose entity, NewEnergy Receivables LLC (NER), on a revolving basis in exchange for cash. This arrangement provides Exelon with a source of liquidity and enhances its working capital management. The initial funding under this facility amounted to approximately $500 million. The Receivables Facility is structured to provide ongoing financing through the sale of receivables, with CNE continuing to service these receivables for a fee. The facility has a term of one year, expiring in April 2021, with the possibility of extension. This move is a strategic financial maneuver aimed at optimizing cash flow and ensuring operational flexibility, particularly relevant in the current economic climate.
Key Highlights
- 1Exelon's subsidiary, Constellation NewEnergy, Inc. (CNE), entered into a new $750 million Receivables Facility.
- 2The facility involves the sale of trade receivables by CNE to a bankruptcy-remote special purpose entity, NewEnergy Receivables LLC (NER).
- 3The agreement is with MUFG Bank, LTD. as Agent, and various Conduits and financial institutions as Purchasers.
- 4CNE will continue to service the receivables under the agreement and will receive a monthly servicing fee.
- 5The facility provides Exelon with immediate access to liquidity, with an initial cash purchase of approximately $500 million received by CNE.
- 6The Receivables Facility has a term of one year, expiring on April 7, 2021, unless extended.
- 7This transaction is designed to improve working capital and provide financial flexibility.