Vistra Prices Private Offering of $2 Billion of Senior Secured Notes

Rhea-AI Summary

Vistra (NYSE: VST) has priced a private offering of $2 billion in senior secured notes through its subsidiary Vistra Operations Company LLC. The offering consists of:

- $750 million of notes due 2028 at 4.300% interest
- $500 million of notes due 2030 at 4.600% interest
- $750 million of notes due 2035 at 5.250% interest

The notes will be secured by first-priority security interest in collateral pledged under the Credit Agreement. Proceeds will be used for refinancing activities, general corporate purposes including potential funding for the Lotus Infrastructure Partners acquisition, and offering-related expenses. The offering is expected to close on October 10, 2025.

Positive

• Successful pricing of a large $2 billion senior secured notes offering
• Strategic debt structuring with staggered maturities (2028, 2030, and 2035)
• Potential collateral release upon achieving investment grade rating
• Flexibility in use of proceeds including refinancing and M&A activities

Negative

• Increased debt burden with substantial interest rates (4.300% to 5.250%)
• Additional secured obligations potentially limiting future financing flexibility

Insights

Fixed Income & Corporate Finance Expert

Vistra's $2B debt offering provides financial flexibility for refinancing and acquisition efforts, while securing favorable interest rates across multiple maturities.

Vistra has successfully priced a substantial $2 billion private offering of senior secured notes across three different maturities, demonstrating strong market access despite the current interest rate environment. The offering includes $750 million of notes due 2028 at 4.300%, $500 million due 2030 at 4.600%, and $750 million due 2035 at 5.250%.

The structured maturity ladder is strategically designed to spread refinancing risk over time while securing current rates before potential market shifts. The modest yield step-up between tranches (0.30% for the first extension and 0.65% for the second) suggests investors view Vistra's long-term credit profile favorably.

These notes come with significant protections for investors, including first-priority security interest in substantial collateral and guarantees from various subsidiaries. However, the collateral release provision upon achieving investment grade ratings indicates management's confidence in potential credit quality improvement.

The financing flexibility is particularly important given Vistra's disclosed plans to potentially fund the previously announced acquisition of Lotus Infrastructure Partners assets. By raising capital ahead of the acquisition closing, Vistra positions itself to execute quickly while maintaining financial optionality. The multi-purpose use of proceeds also allows management to optimize capital allocation between refinancing existing debt and funding growth initiatives based on market conditions and strategic priorities.

IRVING, Texas, Oct. 1, 2025 /PRNewswire/ -- Vistra Corp. (NYSE: VST) (the "Company" or "Vistra") announced today the pricing of a private offering (the "Offering") of $2 billion aggregate principal amount of senior secured notes, consisting of $750 million aggregate principal amount of senior secured notes due 2028 at a price to the public of 99.974% of their face value (the "2028 Notes"), $500 million aggregate principal amount of senior secured notes due 2030 at a price to the public of 99.933% of their face value (the "2030 Notes"), and $750 million aggregate principal amount of senior secured notes due 2035 at a price to the public of 99.691% of their face value (the "2035 Notes" and, together with the 2028 Notes and the 2030 Notes, the "Notes") 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 2028 Notes will bear interest at the rate of 4.300% per annum, the 2030 Secured Notes will bear interest at the rate of 4.600% per annum, and the 2035 Secured Notes will bear interest at the rate of 5.250% per annum. 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 Offering is expected to close on October 10, 2025, subject to customary closing conditions.

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 total size of Vistra's (VST) October 2025 senior secured notes offering?

Vistra priced a $2 billion senior secured notes offering, consisting of three tranches: $750 million due 2028, $500 million due 2030, and $750 million due 2035.

What are the interest rates for VST's new senior secured notes?

The notes carry interest rates of 4.300% for the 2028 notes, 4.600% for the 2030 notes, and 5.250% for the 2035 notes.

How will Vistra use the proceeds from its $2 billion notes offering?

Vistra will use the proceeds for refinancing existing debt, general corporate purposes including potential funding for the Lotus Infrastructure Partners acquisition, and offering-related expenses.

When will VST's October 2025 notes offering close?

The offering is expected to close on October 10, 2025, subject to customary closing conditions.

What security is backing Vistra's new notes offering?

The notes are secured by a first-priority security interest in the same collateral pledged under the Credit Agreement, including substantial property, assets, rights, and equity interests of the issuer and subsidiary guarantors.