Vistra Raises $2.25 Billion in Secured Bonds to Finance Cogentrix Acquisition
The American group Vistra announced on January 12 that it has finalized the pricing of its private issuance of secured bonds totaling $2.25 billion. According to the statement, the primary purpose of this operation is to finance the acquisition of Cogentrix Energy, previously announced.
Details of the Bond Issue
The operation includes two distinct tranches, the company indicates. The first consists of $1 billion in bonds maturing in 2031, issued at 99.954% of their face value and bearing an interest rate of 4.700% per annum. The second tranche represents $1.25 billion in bonds maturing in 2036, placed at 99.745% of their face value with a coupon of 5.350% per annum. These securities are issued by Vistra Operations Company, a subsidiary indirectly and wholly owned by the parent company.
Placement and Security Details
According to the statement, the bonds were placed with qualified institutional buyers in accordance with Rule 144A of the Securities Act of 1933, as well as with certain non-U.S. persons under Regulation S. The securities are backed by full and unconditional guarantees from certain current and future subsidiaries of the issuer, which also guarantee the group's credit agreement dated October 3, 2016. The bonds are secured by a first-priority lien on the same assets as those pledged under the credit agreement, representing a substantial portion of the assets and rights held by the issuer and the guarantor subsidiaries.
Use of Proceeds
According to the group, the proceeds from the issuance will be used to finance a portion of the acquisition of Cogentrix Energy, for general purposes including the repayment of certain existing debts, as well as the payment of fees and expenses related to the operation. The closing of the issuance is expected on January 22, 2026, subject to customary conditions. The statement specifies that the bonds are not registered with the Securities and Exchange Commission and may not be offered or sold in the United States absent registration or an applicable exemption.
