content

TXU (TCEH) two-part bonds price; terms

Energy Future Holdings, formerly TXU, today completed the balance of its $11.25 billion LBO bridge-to-bonds via subsidiary Texas Competitive Electric Holdings Company (TCEH). Joint bookrunners were Goldman Sachs, Morgan Stanley, Citi, J.P. Morgan, Lehman Brothers, and Credit Suisse, sources said. Terms on the B-series 10.25% notes came at a one-point discount to the existing paper, and the PIK toggle bonds printed 53 bps behind the cash-pay tranche.

Dallas-based TXU Corp. generates and distributes power to over two million customers in Texas through coal-fired, nuclear-powered and wind-generated plants. The company’s board accepted a $69.25-per-share private equity buyout offer from Kohlberg Kravis Roberts and Texas Pacific Group in February. A $32 billion purchase price and the assumption of $13 billion in debt make the transaction one of the largest LBOs ever. Terms:

Issuer: Texas Competitive Electric Holdings Company (TCEH)
Ratings: CCC/B3
Size: $2 billion
Issue: series B senior notes
Coupon: 10.25%
Price: 95
Yield: 11.216%
Spread: +737
LIBOR Eq: +661
Maturity: Nov. 1, 2015
Call: nc4
Trade: Nov. 29, 2007
Settle: Dec. 6, 2007 (t+5)
Books: GS/MS/CITI/JPM/CS/LEH
Px Talk: n/a
Notes: not fungible with original $3 billion, which priced at par Oct. 24, 2007
Issuer: Texas Competitive Electric Holdings Company (TCEH)
Ratings: CCC/B3
Size: $1.75 billion
Issue: senior PIK toggle notes
Coupon: 10.5%
Price: 93.25
Yield: 11.747%
Spread: +790
LIBOR Eq: +714
Maturity: Nov. 1, 2016
Call: nc5
Trade: Nov. 29, 2007
Settle: Dec. 6, 2007 (t+5)
Books: GS/MS/CITI/JPM/CS/LEH
Px Talk: n/a
Notes: PIK-election only after call period