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Talen Energy secures $1.2bn to acquire two natural gas power plants in the United States

Talen Energy launches $1.2bn debt financing and expands credit facilities to support strategic acquisitions of two combined-cycle natural gas power plants.

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Talen Energy Supply, a wholly owned subsidiary of Talen Energy Corporation, has launched a $1.2bn Term Loan B financing to support the acquisition of two natural gas-fired power plants with a combined capacity of 2,881 megawatts. The group has also secured commitments to increase its revolving credit facility by $200mn to $900mn and expand its standalone letter of credit facility by $200mn, bringing the total to $1.1bn.

Two strategic plants with complementary capacities

The proceeds will be used to finance the acquisition of the Freedom Energy Center, a 1,045-megawatt combined-cycle plant located in Luzerne County, Pennsylvania, and the Guernsey Power Station, a 1,836-megawatt facility in Guernsey County, Ohio. Both transactions were concluded through purchase and sale agreements signed on July 17 between Talen Generation, an indirect subsidiary of Talen Energy Corporation, and affiliates of Caithness Energy.

Flexible financing structure with delayed draw feature

Should the two acquisitions not close simultaneously, the financing includes both initial and delayed draw components, allowing Talen Energy to align funding with the timeline of each transaction. If only one acquisition is completed by July 17, 2026, or by January 17, 2027, in case of contractual extension, the delayed draw portion will be automatically cancelled.

Maturity extension and liquidity management

The company has also extended the maturity of its standalone letter of credit facility from December 2026 to December 2027, strengthening its medium-term liquidity position. The transaction is part of Talen Energy’s broader financial strategy to support strategic thermal assets while maintaining a flexible capital structure.

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