(MSU Energy, 3.Dec.2018) — MSU Energy, a growing power generator with operations located in Argentina, announced significant developments to secure the ongoing expansion and conversion to combined cycle of its three power plants, which will increase total installed capacity to 750 MW.
On November 30, 2018, MSU Energy closed a private placement of $250 million senior secured notes due 2023. The notes priced at 3-month Libor plus 11.25% and are guaranteed by certain assets related to the expansion and a pledge of shares of the issuers. The proceeds will be used to finance the combined cycle expansion, repay short-term debt and for general corporate purposes.
Hernan Walker, MSU Energy’s Chief Financial Officer, said: “This private placement is a major milestone for our company. We have fully funded the strategic expansion of our three power plants, which we expect will allow us to double EBITDA by 2020. Combined with our $600 million debut bond at 6.875% issued in February 2018, our average weighted cost of capital stands at 8.9% with an average maturity slightly below 6-years, significantly reducing our refinancing risk in this volatile market context.”
Pablo Ferrero, MSU Energy’s Executive Director, added: “The combined cycle construction is well advanced and on schedule. Our EPC contractor, AESA (YPF affiliate) and our equipment supplier, General Electric, are engaged and highly committed to the project. Once the combined cycle is complete, MSU Energy will be a unique power generator in Argentina, with total installed capacity of 750 MW composed of high quality and reliable technology, 100% under combined cycle operation and 100% contracted in attractive long term PPA’s in US dollars. We appreciate the ongoing support and confidence from investors, bondholders and all stakeholders.”
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