Summary
Vistra Corp. (VST), through its subsidiary Vistra Operations Company LLC, announced two significant debt offerings on June 4th and June 6th, 2019. The company entered into purchase agreements for the issuance of $2.0 billion in senior secured notes and $1.3 billion in senior unsecured notes. The secured notes consist of $1.0 billion in 3.55% notes due 2024 and $1.0 billion in 4.30% notes due 2029, which are backed by a substantial portion of Vistra Operations' and its subsidiary guarantors' assets. The unsecured notes are 5.00% senior notes due 2027. The primary use of proceeds from the secured notes offering is to prepay outstanding amounts under the company's senior secured term loan. For the unsecured notes, the proceeds will be used to fund cash tender offers for its 7.375% Senior Notes due 2022 and up to $760 million of its 7.625% Senior Notes due 2024, with any remaining funds allocated for general corporate purposes. These transactions are part of Vistra's ongoing efforts to manage its capital structure and optimize its debt profile.
Key Highlights
- 1Vistra Operations Company LLC is issuing $2.0 billion in senior secured notes across two tranches: 3.55% due 2024 and 4.30% due 2029.
- 2Vistra Operations Company LLC is also issuing $1.3 billion in senior unsecured notes with a 5.00% coupon due 2027.
- 3Proceeds from the secured notes offering will be used to repay outstanding balances under the senior secured term loan.
- 4Proceeds from the unsecured notes offering will fund cash tender offers to repurchase outstanding 7.375% Senior Notes due 2022 and up to $760 million of 7.625% Senior Notes due 2024.
- 5Both note offerings are being conducted as private placements to qualified institutional buyers under Rule 144A and to non-U.S. persons.
- 6The secured notes are backed by a first-priority security interest in substantially all assets of Vistra Operations and its subsidiary guarantors, subject to release under specific investment grade rating conditions.
- 7The transactions are expected to close in June 2019, subject to customary closing conditions.