S&P gives Calpine notes B

S&P said it assigned a B issue-level rating and 5 recovery rating to Calpine Corp.’s $650 million of senior unsecured notes due 2029 and $850 million of senior unsecured notes due 2031.

The company will use the proceeds together with about $230 million from an earlier $900 million offering at the Geysers to retire about $1.7 billion of senior debt. Calpine plans to cut its interest costs through this refinancing, the agency said.

“We consider the refinancing to be leverage neutral because we add back the debt from the Geyser transaction to Calpine’s balance sheet,” S&P said in a press release.

The outlook is positive.

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