Talen Energy Supply, a wholly owned subsidiary of Talen Energy Corporation, has closed two private offerings of senior notes totalling $2.69bn. The transaction will finance the acquisition of two combined cycle natural gas power plants located in Pennsylvania and Ohio. The bonds include a $1.40bn tranche maturing in 2034 with a 6.250% coupon and a $1.29bn tranche maturing in 2036 with a 6.500% interest rate.
Expansion of thermal generation capacity
The proceeds will be combined with a new $1.2bn secured term loan B to fund two strategic acquisitions: Freedom Energy Center, a 1,045 MW facility in Luzerne County, Pennsylvania, and Guernsey Power Station, a 1,836 MW plant in Guernsey County, Ohio. The purchases will be executed under sale agreements signed on July 17, 2025, between affiliated entity Talen Generation and companies linked to Caithness Energy.
Conditional redemption requirement
If either acquisition is not completed by July 17, 2026 — or January 17, 2027, if extended — Talen will be required to redeem part or all of the issued bonds. In the event of the Freedom deal being cancelled, $625mn in 2034 notes and $575mn in 2036 notes must be redeemed. For Guernsey, the amounts are $900mn and $790mn, respectively. If both deals fail, the entire offering must be repurchased at issue price plus accrued interest.
Placement limited to qualified investors
The bonds are not registered with U.S. financial authorities. They were placed with qualified institutional buyers under Rule 144A of the Securities Act of 1933 and with non-U.S. investors under Regulation S. No public offering was conducted in the United States.
The financing supports Talen Energy’s expansion of its thermal generation portfolio while relying on private placements to limit public market exposure.
