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Talen Energy Supply launches cash tender offers for $1B of senior notes

Talen Energy Supply LLC launched tender offers to purchase for cash up to $900 million of its outstanding 4.625% senior notes due 2019 and 6.500% senior notes due 2018, and up to $100 million for its 4.600% senior notes due 2021.

The tender offers will expire at 11:59 p.m. ET on April 27, unless earlier terminated by Talen Energy Supply.

Holders will receive considerations of $1,000 for the 4.625% notes, $1,021.25 for the 6.500% notes and $840 for the 6.500% notes for each $1,000 principal amount of notes tendered. Holders will also receive an early tender payment of $30 per $1,000 principal amount of notes tendered on or prior to 5 p.m. ET on April 12.

The company said it will fund the tender offers with net proceeds from one or more offerings of debt securities, cash on hand and borrowings under available credit facilities.

Morgan Stanley & Co. LLC and Credit Suisse Securities (USA) LLC are serving as the joint lead dealer managers for the tender offers, and BNP Paribas Securities Corp., Deutsche Bank Securities Inc., Goldman Sachs & Co, MUFG Securities Americas Inc., RBC Capital Markets, Riverstone Capital Services and UBS Securities LLC are acting as co-dealer managers.

Separately, Talen Energy Supply plans to syndicate a new $400 million secured term loan B facility and reprice its existing $600 million term loan B facility.

The Talen Energy Corp. subsidiary, subject to certain market conditions, on March 30 launched a private offering of up to $500 million of senior unsecured guaranteed notes due 2022, according to a separate March 30 release.

The company plans to use proceeds of the new term loan B facility, along with proceeds from a new senior guaranteed notes offering, to refinance, repurchase and/or repay existing debt, including the newly announced tender offers and to pay transaction fees and expenses.

Morgan Stanley, Goldman Sachs, Deutsche Bank Securities, MUFG, Credit Suisse and RBC Capital Markets are the lead arrangers for the new term loan B facility.