Argo Infrastructure Partners has announced the successful completion of a $435m senior secured notes financing for Smoky Mountain Holdings, a joint venture (JV) between Argo and Brookfield.
The JV comprises the Smoky Mountain hydroelectric facilities, including the Cheoah, Calderwood, Chilhowee and Santeetlah hydroelectric dams.
The financing is a significant step in strengthening Smoky’s position as a key supplier of clean, sustainable energy in the Tennessee Valley, supporting the growth in demand from data centres.
The transaction marks the first financing of its kind completed in the US private placement market. It features a unique structure that combines fixed and variable amortisation features.
This innovative approach was well received by investors, with both tranches of the financing oversubscribed.
Argo Infrastructure Partners founder and managing partner Jason Zibarras stated: “This innovative investment-grade financing represents another step in supporting clean energy in the Tennessee Valley and the resilient, low-carbon energy that the AI economy demands.
“This project demonstrates our and Smoky’s commitment to innovation, powering economic growth, and US leadership in the global AI ecosystem.”
The financing is closely aligned with the ten-year power purchase agreement signed in 2024 with the Tennessee Valley Authority (TVA).
Smoky is set to deliver more than 14 gigawatt hours (GWh) of domestically sourced carbon-free hydroelectric energy, which will help avoid more than 11 million tonnes of CO₂ emissions for TVA’s customers over the next decade.
Argo director at Smoky Brice Soucy stated: “We’re proud to have closed this first-of-its-kind financing structure, which reflects Smoky's status as a best-in-class, flexible and dispatchable clean energy portfolio.
“As digitalisation, AI and advanced industries redefine the future of energy demand for TVA, this transaction not only fortifies the nation’s energy grid but also powers the next wave of innovation, delivering the reliable, low-carbon energy that will shape tomorrow’s economy and the technological breakthroughs of the future.”
