Calpine Prices Canadian Power Income Fund
CALGARY, Alberta, Aug 26, 2002
Calpine Corporation (NYSE: CPN) (Calpine), a leading North American power producer, today announced it has priced the initial public offering of its newly established Canadian income trust fund -- the Calpine Power Income Fund.
The Calpine Power Income Fund, with a market valuation of approximately Cdn$520 million, will indirectly own a 70% interest in Calpine Power L.P. through Class A Priority Units, with Calpine owning the remaining interest in the form of Class B Subordinated Units. Calpine Power L.P. holds interests in Calpine's three Canadian power-generating assets, representing a combined power generating capacity of approximately 550 net megawatts.
Under this initial offering, Calpine Power Income Fund will issue to the public 23 million of the approximately 52 million total Trust Units outstanding for gross proceeds of Cdn$230 million. Calpine will retain the remaining Trust Units for potential future sale. To cover over-allotments, Calpine has granted its underwriters an option to purchase up to 3.45 million Trust Units for a period expiring 30 days following the closing of the offering. The Trust Units were priced at Cdn$10.00 per unit, to initially yield 9.35% per annum.
A final prospectus was filed with securities commissions in Canada today. The offering is expected to close on August 29, 2002, with the first cash distribution expected to be paid on or about October 20, 2002 to unitholders of record as of September 30, 2002. The Calpine Power Income Fund will make monthly cash distributions to its unitholders.
Standard & Poor's has assigned its second-highest Canadian stability rating of "SR-2" to the Trust Units, with a stable outlook. The Toronto Stock Exchange has conditionally approved the listing of the Trust Units, subject to the fulfillment of customary conditions. The Trust Units will trade under the symbol CF.UN.
The Calpine Power Income Fund power-generating assets include the 225-megawatt Island Cogeneration Facility located in British Columbia, near Campbell River and the 300-megawatt combined-cycle Calgary Energy Centre, currently under construction in Calgary, Alberta. The Calpine Power Income Fund also will make a loan to a Calpine subsidiary, which indirectly holds a half-interest in the 50-megawatt Whitby Cogeneration Facility, located in Whitby, Ontario.
The offering was jointly led by Scotia Capital Inc. and CIBC World Markets Inc. on behalf of a syndicate of underwriters that includes National Bank Financial Inc., TD Securities Inc., Canaccord Capital Corporation, HSBC Securities (Canada) Inc. and Dundee Securities Corporation. |
