Research Update: Hunterstown Generation LLC Proposed Debt Assigned Preliminary 'BB-' Rating; Outlook Stable

Gettysburg, Penn.-based Hunterstown Power Generation LLC (863 MW combined cycle natural gas-fired generation plant), operating in PJM-MAAC region has been acquired by LS Power Corp. As part of its new ownership, Hunterstown Generation LLC intends to issue a $500 million senior secured term loan B and a $75 million revolving credit facility. The company will use proceeds to refinance existing debt ($374 million outstanding as of June 30, 2024), fund a sponsor distribution (about $116 million), and pay associated fees and expenses. We assigned our preliminary 'BB-' rating and '2' recovery rating to Hunterstown's proposed senior secured term loan B and revolving facility. Our 'BB-' rating reflects our expectation of strong market fundamentals for the next few years due to

...- Gettysburg, Penn.-based Hunterstown Power Generation LLC (863 MW combined cycle natural gas-fired generation plant), operating in PJM-MAAC region has been acquired by LS Power Corp. - As part of its new ownership, Hunterstown Generation LLC intends to issue a $500 million senior secured term loan B and a $75 million revolving credit facility. - The company will use proceeds to refinance existing debt ($374 million outstanding as of June 30, 2024), fund a sponsor distribution (about $116 million), and pay associated fees and expenses. - We assigned our preliminary '##-' rating and '2' recovery rating to Hunterstown's proposed senior secured term loan B and revolving facility. - Our '##-' rating reflects our expectation of strong market fundamentals for the next few years due to the expansion of digital infrastructure resulting in a surge in power demand from data center energy consumption along with the strong results in the Pennsylvania-New Jersey-Maryland (PJM) 2025-2026 capacity auction...

Research Update