Investec and Starwood Co-Lead Hickory Run Refinancing

Investec, a leading international financial services provider, is pleased to announce that its Energy and Infrastructure (North America) team has acted as Sole Bookrunner for the refinancing of Hickory Run, together with Starwood Infrastructure Finance, a division of Starwood Property Trust, as Coordinating Lead Arranger. Hickory Run is a combined Cycle Gas Turbine facility located in New Castle, Pennsylvania, owned by Tyr Energy and Kansai Electric Power.

Hickory Run is a 1,000-MW natural gas-fired combined cycle power plant that has been a critical baseload generator since achieving commercial operation in May 2020. The facility has maintained a capacity factor in excess of 70%, contributing significantly to the region's energy supply.

The financing package includes a $210 million Term Loan and a $55 million Revolving Credit Facility. The net proceeds from this financing will be utilised to repay the original construction financing, which was due to mature in June 2025. Texas Capital Bank also participated as a Joint Lead Arranger in this transaction. This refinancing is notable for being one of the few conventional power financings completed in the Term Loan A market.

Jack Herrold, CFO of Tyr Energy, stated: “We couldn’t be more pleased with this refinancing, which gives us maximum flexibility in terms of energy hedging strategies, debt amortisation, and distribution flexibility. Investec and Starwood have been great financing partners, and we look forward to working with them in the future.”

Nic Tucker, who leads origination for conventional power at Investec Energy & Infrastructure finance, North America, commented: “Investec is proud to have supported Tyr, alongside Starwood, in the refinancing of Hickory Run. Investec is amongst a few select lenders who have consistently supported premier sponsors in their conventional power investments. This transaction has validated that there is appetite for well-structured bank paper at a time where most issuers have tapped the Term Loan B market for conventional power financing.”

Moore & Van Allen PLLC served as legal counsel to Tyr Energy, while Sidley Austin LLP acted as legal counsel to the lenders.

The successful refinancing of Hickory Run underscores Investec Energy & Infrastructure Finance’s commitment to providing tailored financing solutions for conventional power projects in North America. The facility's strategic position and operational efficiency highlight its importance in the evolving energy landscape.