Article
Santander Leading Up to $3B Leveraged Loan Package Backing Constellation Sale of PJM Assets to LS Power
Santander is leading an up to $3 billion leveraged loan package to back LS Power’s acquisition of Constellation’s generation assets in PJM, according to sources.
The financing for Constellation’s assets is expected to be structured entirely as loans, sources said. A launch is eyed for sometime in the early summer, subject to market conditions, sources said, cautioning that terms were early and not finalized.
The acquisition was announced on March 18, according to a press release. LS Power will acquire approximately 4.4 gigawatts of mostly gas-fired generation in Delaware and Pennsylvania, including the Bethlehem, York 1 & 2, Hay Road and Edge Moor facilities. The transaction is valued at $5 billion, which implies a purchase price of roughly $1,142 per kilowatt.
LS Power’s acquisition is part of a key step in satisfying regulatory commitments related to Constellation’s acquisition of Calpine, the release said, which was completed in January, according to another press release.
Constellation’s offering is expected to perform well in the market, according to a banker close to the deal, who noted that given recent geopolitical-related volatility, the energy sector is a safe area to get involved in.
For example, Bayonne Energy Center launched its $675 million term loan B today to support its acquisition by Elliot, one of the few deals to launch during a slower primary market this week. Another example is liquefied natural gas provider Venture Global, with its $1.75 billion term loan B tightening to SOFR+325 bps at 98.5 OID as of last week.
Constellation holds a Baa1/BBB credit rating from Moody’s Ratings and S&P Global Ratings. In an S&P ratings note from January, the credit ratings agency said Constellation had $7.5 billion of long-term debt on its balance sheet as of September 2025.
Santander is also serving as financial advisor to LS Power, with White & Case LLP and Willkie Farr & Gallagher LLP acting as legal counsel, the press release said. Barclays, SMBC and Jefferies are serving as M&A advisors to Constellation, with Kirkland & Ellis as legal counsel.
Santander and LS Power declined to comment. Constellation did not return a request for comment.
This publication has been prepared by Octus Intelligence, Inc. or one of its affiliates (collectively, "Octus") and is being provided to the recipient in connection with a subscription to one or more Octus products. Recipient’s use of the Octus platform is subject to Octus Terms of Use or the user agreement pursuant to which the recipient has access to the platform (the “Applicable Terms”). The recipient of this publication may not redistribute or republish any portion of the information contained herein other than with Octus express written consent or in accordance with the Applicable Terms. The information in this publication is for general informational purposes only and should not be construed as legal, investment, accounting or other professional advice on any subject matter or as a substitute for such advice. The recipient of this publication must comply with all applicable laws, including laws regarding the purchase and sale of securities. Octus obtains information from a wide variety of sources, which it believes to be reliable, but Octus does not make any representation, warranty, or certification as to the materiality or public availability of the information in this publication or that such information is accurate, complete, comprehensive or fit for a particular purpose. Recipients must make their own decisions about investment strategies or securities mentioned in this publication. Octus and its officers, directors, partners and employees expressly disclaim all liability relating to or arising from actions taken or not taken based on any or all of the information contained in this publication. © 2026 Octus. All rights reserved. Octus(TM) and the Octus logo are trademarks of Octus Intelligence, Inc.