Vistra Announces Private Offering of Senior Secured Notes

Rhea-AI Summary

Vistra (NYSE: VST) has announced a private offering of senior secured notes due in 2028, 2030, and 2035. The notes will be issued through Vistra Operations Company LLC and will be fully guaranteed by certain subsidiaries. The offering is exclusively available to qualified institutional buyers under Rule 144A and non-U.S. persons under Regulation S.

The notes will be secured by first-priority security interests in substantial company assets and will maintain this security until the Issuer's senior unsecured long-term debt achieves investment grade ratings. Proceeds will be used for refinancing activities, general corporate purposes, and potentially funding part of the previously announced Lotus Infrastructure Partners acquisition.

Positive

• Secured notes offering strengthens company's debt structure with extended maturities to 2028, 2030, and 2035
• First-priority security interest provides strong protection for note holders
• Flexibility in use of proceeds allows for strategic deployment including potential acquisition funding

Negative

• Additional secured debt could increase overall leverage
• Security interest encumbers substantial portion of company assets
• Potential dilution of existing creditors' claims on assets

Insights

Corporate Bond Analyst

Vistra's senior secured notes offering strengthens liquidity while supporting acquisition plans and potential debt refinancing.

Vistra (VST) has announced a private offering of senior secured notes with maturities spanning 2028, 2030, and 2035 to qualified institutional investors. The offering's three-tranche structure with staggered maturities demonstrates a methodical approach to debt management, creating a more balanced maturity profile that reduces refinancing risk.

These notes carry significant structural protections, being secured by first-priority interests in substantial company assets and backed by subsidiary guarantees. This collateral package should enhance investor confidence and potentially allow for more favorable pricing compared to unsecured alternatives. Interestingly, the security features include an automatic release mechanism if Vistra's unsecured debt achieves investment grade status from two rating agencies – creating a built-in incentive for broader credit improvement.

The proceeds will support three strategic initiatives: refinancing existing debt, funding general corporate purposes, and potentially financing part of the previously announced Lotus Infrastructure Partners acquisition. This flexibility gives management options to optimize their capital deployment based on market conditions. The refinancing component suggests Vistra is proactively managing its liabilities, potentially extending maturities or reducing interest costs in a rising rate environment.

For investors, this offering signals Vistra's continued access to debt markets while pursuing strategic growth through acquisition. The company's ability to execute this private placement indicates institutional investor confidence in Vistra's credit profile and business trajectory.

IRVING, Texas, Oct. 1, 2025 /PRNewswire/ -- Vistra Corp. (NYSE: VST) (the "Company" or "Vistra") announced today the launch of senior secured notes due 2028, senior secured notes due 2030, and senior secured notes due 2035 (collectively, the "Notes") in a private offering (the "Offering") to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and to certain non-U.S. persons in accordance with Regulation S under the Securities Act. The Notes will be senior, secured obligations of Vistra Operations Company LLC, a Delaware limited liability company and an indirect wholly owned subsidiary of the Company (the "Issuer"). The Notes will be fully and unconditionally guaranteed by certain of the Issuer's current and future subsidiaries that also guarantee the Issuer's Credit Agreement, dated as of October 3, 2016 (as amended, the "Credit Agreement"), by and among the Issuer, as borrower, Vistra Intermediate Company LLC, the guarantors party thereto, Citibank, N.A., as administrative and collateral agent, various lenders and letter of credit issuers party thereto, and the other parties named therein. The Notes will be secured by a first-priority security interest in the same collateral that is pledged for the benefit of the lenders under the Credit Agreement and certain other agreements, which consists of a substantial portion of the property, assets and rights owned by the Issuer and the subsidiary guarantors as well as the equity interest of the Issuer. The collateral securing the Notes will be released if the Issuer's senior, unsecured long-term debt securities obtain an investment grade rating from two out of the three rating agencies, subject to reversion if such rating agencies withdraw the investment grade rating of the Issuer's senior, unsecured long-term debt securities or downgrade such rating below investment grade.

The Company intends to use the proceeds from the Offering (i) to support refinancing activities for outstanding indebtedness, (ii) for general corporate purposes, which could include funding a portion of the consideration for the previously announced acquisition by the Company of 100% of the membership interests of certain subsidiaries of Lotus Infrastructure Partners ("Lotus") and/or (iii) to pay fees and expenses related to the Offering.

The Notes will not be registered under the Securities Act or the securities laws of any state or other jurisdiction and may not be offered or sold in the United States absent registration or an applicable exemption from such registration requirements.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy the securities described above, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction.

About  Vistra
Vistra (NYSE: VST) is a leading Fortune 500 integrated retail electricity and power generation company based in Irving, Texas, that provides essential resources to customers, businesses, and communities from California to Maine. Vistra is a leader in transforming the energy landscape, with an unyielding focus on reliability, affordability, and sustainability. The company safely operates a reliable, efficient power generation fleet of natural gas, nuclear, coal, solar, and battery energy storage facilities while taking an innovative, customer-centric approach to its retail business. Learn more at vistracorp.com.

Cautionary Note Regarding Forward-Looking Statements
The information presented herein includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, which are based on current expectations, estimates and projections about the industry and markets in which Vistra operates and beliefs of and assumptions made by Vistra's management, involve risks and uncertainties, which are difficult to predict and are not guarantees of future performance, that could significantly affect the financial results of Vistra. All statements, other than statements of historical facts, that are presented herein, or in response to questions or otherwise, that address activities, events or developments that may occur in the future, including such matters as activities related to our financial or operational projections including financial condition and cash flows, projected synergy, net debt targets, capital allocation, capital expenditures, liquidity, projected Adjusted EBITDA to free cash flow conversion rate, dividend policy, business strategy, competitive strengths, goals, future acquisitions or dispositions, development or operation of power generation assets, market and industry developments and the growth of our businesses and operations (often, but not always, through the use of words or phrases, or the negative variations of those words or other comparable words of a future or forward-looking nature, including, but not limited to: "intends," "plans," "will likely," "unlikely," "believe," "confident", "expect," "seek," "anticipate," "estimate," "continue," "will," "shall," "should," "could," "may," "might," "predict," "project," "forecast," "target," "potential," "goal," "objective," "guidance" and "outlook"), are forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements. Although Vistra believes that in making any such forward-looking statement, Vistra's expectations are based on reasonable assumptions, any such forward-looking statement involves uncertainties and risks that could cause results to differ materially from those projected in or implied by any such forward-looking statement, including, but not limited to: (i) adverse changes in general economic or market conditions (including changes in interest rates) or changes in political conditions or federal or state laws and regulations; (ii) the ability of Vistra to execute upon its contemplated strategic, capital allocation, performance, and cost-saving initiatives, including the closing of the acquisition of the natural gas assets from Lotus, and to successfully integrate acquired businesses; (iii) actions by credit ratings agencies; (iv) the severity, magnitude and duration of extreme weather events, contingencies and uncertainties relating thereto, most of which are difficult to predict and many of which are beyond our control, and the resulting effects on our results of operations, financial condition and cash flows; and (v) those additional risks and factors discussed in reports filed with the Securities and Exchange Commission by Vistra from time to time, including the uncertainties and risks discussed in the sections entitled "Risk Factors" and "Forward-Looking Statements" in Vistra's annual report on Form 10-K for the year ended December 31, 2024 and any subsequently filed quarterly reports on Form 10-Q.

Any forward-looking statement speaks only at the date on which it is made, and except as may be required by law, Vistra will not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date on which it is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible to predict all of them; nor can Vistra assess the impact of each such factor or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement.

 

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SOURCE Vistra Corp

FAQ

What is the purpose of Vistra's (VST) new senior secured notes offering?

The offering will support refinancing activities, general corporate purposes, and potentially fund part of the Lotus Infrastructure Partners acquisition.

When do Vistra's (VST) new senior secured notes mature?

The notes have three different maturity dates: 2028, 2030, and 2035.

Who can participate in Vistra's (VST) senior secured notes offering?

The offering is limited to qualified institutional buyers under Rule 144A and non-U.S. persons under Regulation S.

What collateral backs Vistra's (VST) new senior secured notes?

The notes are secured by a first-priority security interest in substantial company assets and equity interests of Vistra Operations Company LLC.

When will the collateral securing Vistra's (VST) notes be released?

The collateral will be released when the Issuer's senior unsecured long-term debt securities obtain investment grade ratings from two out of three rating agencies.