Narrative
Full Description
Project narrative
On May 15, 2017, financial close was reached on a deal in which a syndicate of at least 21 lenders — including the New York Branch of the Industrial and Commercial Bank of China (ICBC) — entered into a $1.175 billion USD syndicated facility agreement with Gridiron Funding, LLC — a Delaware-incorporated special purpose vehicle (SPV) wholly-owned by Gridiron Acquisition Holdings, LLC, itself wholly-owned by Delaware-incorporated Gridiron Intermediate Holdings, LLC, itself wholly-owned by Delaware-incorporated Gridiron Pledgor, LLC, itself wholly-owned by Delaware-incorporated Gridiron Holdings, LLC; Gridiron Holdings is together owned by 1) Delaware-incorporated Gridiron Energy Management, LLC (as manager and controller) itself wholly-owned by LSP Gridiron Member, LLC, itself wholly-owned by Delaware-incorporated LSP Generation IV, LLC, itself wholly-owned by LS Power Associates, L.P., a Delaware limited partnership managed and controlled by its sole general partner LS Power Development, LLC, a Delaware-incorporated American family and employee-owned power and energy infrastructure development, investment, and operation company and 2) by Delaware-incorporated Gridiron Energy, LLC, which is managed and controlled by a subsidiary of LS Power Associates, L.P., which is a Delaware limited partnership managed and controlled by its sole general partner LS Power Development, on behalf of itself and unspecified institutional investors — for the Gridiron Generation 3150 MW Portfolio Acquisition Project. This facility was divided into three tranches: a $590.00 million USD senior secured term loan tranche with a maturity period of seven years and a final maturity date of May 15, 2024; a $125.00 million USD senior secured revolving credit facility (RCF) tranche with a maturity period of five years and a final maturity date of May 15, 2022; and a $460.00 million USD senior secured notes offering private placement tranche with a maturity period of 10 years, a final maturity date of May 15, 2027, and a fixed rate coupon of 5.64%. ICBC contributed $39.00 million USD to the $590 million USD term loan tranche. Record ID#105783 captures ICBC's contribution. In addition to ICBC, the following lenders contributed to the tranche: Aflac Incorporated ($5.00 million USD), Associated Bank ($17.00 million USD), Bank of Montreal (BMO) ($25.00 million USD), BNP Paribas S.A. ($10.00 million USD), CIT Bank ($28.00 million USD), CoBank ($35.00 million USD), Crédit Agricole Corporate and Investment Bank (CACIB) ($39.00 million USD), GE Capital EFS Financing, Inc. ($39.00 million USD), KEB Hana Bank of New York ($50.00 million USD), ING Capital LLC ($49.00 million USD), Barings LLC ($40.00 million USD), Migdal Insurance and Financial Holdings Ltd. ($50.00 million USD), The Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU) ($39.00 million USD), National Life Insurance Company ($10.00 million USD), the New York Branch of Norddeutsche Landesbank Girozentrale (NORD/LB) ($60.00 million USD), Royal & Sun Alliance Insurance Limited ($20.00 million USD), and unspecified other lenders ($35.00 million USD). ICBC contributed $21.00 million USD to the $125 million USD RCF tranche. Record ID#105784 captures ICBC's contribution. In addition to ICBC, the following lenders contributed to the tranche: BMO ($5.00 million USD), BNP Paribas ($10.00 million USD), CoBank ($5.00 million USD), CACIB ($21.00 million USD), GE Capital ($21.00 million USD), ING Capital ($21.00 million USD, and BTMU ($21.00 million USD). ICBC, alongside CACIB, GE Capital, ING Capital, BTMU, and NORD/LB each arranged $76.67 million USD for the $460 million USD senior secured notes offering. In September 2017, ABL Life, Lotte Non-life Insurance, Shinhan Life Insurance, and MiraeAsset Life Insurance bought portions of the private placement. ICBC NY Branch, BTMU, GE Capital EFS Financing, ING Capital, the New York Branch of NORD/LB, and CCB served as coordinating lead and joint bookrunners on the bank debt. Other reported lenders on the term and RCF tranches included Global Investment Fund I - Global Infra Debt BAR Portfolio, a fund controlled by Aflac Life Insurance Japan Ltd., IFM Investors, and Sentinel Capital Partners, though the nature of their participation (i.e. a portion of the above debt further syndicated to them) is unknown. Baring, BMO, BNP Paribas, CoBank, KEB Hana Bank, and Migdal served as co-lead arrangers. Associated Bank, CIT Bank, IFM Investors, and Sentinel Capital Partners participated as lenders. Goldman Sachs led the private placement tranche. The term loan tranche was initially launched at $500 million USD but increased to $590 million USD due to oversubscription. The private placement was reduced from $550 million USD to $460 million USD as the term loan tranche was increased. The proceeds were to be used by the borrower for the $1.75 billion USD acquisition of a portfolio consisting of five gas-fired power generating assets with a combined capacity of roughly 3,510 MW with remaining proceeds to be used for debt refinancing and general corporate purposes. The portfolio was owned by the fund LS Power Equity Partners II, L.P., which LS Power was winding down; the assets were sold to partnership Gridiron Generation, a group of new institutional investors, but since an affiliate of LS Power remained the general partner of Gridiron, there was no change of control (nor were parties to the deal required to file for authorization of the sale with the U.S. Federal Energy Regulatory Commission). The acquisition and financing closed together on May 15, 2017. The portfolio consisted of five gas-fired power generating assets, one combined-cycle plant and four peaking ("peaker") power plants: the 814 MW Doswell Energy Center, a combined-cycle plant with an ongoing expansion, 340 MW Doswell II, under construction in Ashland, Hanover County, Virginia; the 540 MW University Park North Energy Center and the 300 MW University Park South Energy Center in University Park, Will County, Illinois; the 825 MW Riverside Generating Station in Catlettsburg, Lawrence County, Kentucky; and the 225 MW Wallingford Energy Center with an ongoing 100 MW expansion under construction in Wallingford, New Haven County, Connecticut. All assets were part of the PJM Interconnection except for Wallingford, which was part of the New England ISO.
Staff comments
1. This project is also known as Project Gridiron. 2. Gridiron Funding, LLC wholly-owns Gridiron Generating, LLC, the closed-end special purpose partnership associated with the project; the portfolio is sometimes called Gridiron Generation, accordingly.