Infrastructure
NextEra Energy Offers Equity Units; NextEra Energy Partners Issues 35 Million New Units
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According to the announcement:
Each equity unit will be issued in a stated amount of $50. Each equity unit will consist of a contract to purchase NextEra Energy common stock in the future, and a 5 percent undivided beneficial ownership interest in a NextEra Energy Capital Holdings, Inc. debenture due Sept. 1, 2020, to be issued in the principal amount of $1,000. The debentures will be guaranteed by NextEra Energy Capital Holdings’ parent company, NextEra Energy, Inc.
At the same time, NextEra Energy Partners announced that it had priced an underwritten public offering of 8 million limited partner common units at $26.00 per unit. That reflected a discount of about 0.7% to the closing price of $26.18 on Thursday.
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The underwriters for the offering include joint bookrunners Wells Fargo Securities, Barclays, Bank of America Merrill Lynch, Credit Suisse, Goldman Sachs and Morgan Stanley, as well as co-managers BMO Capital Markets, Deutsche Bank Securities, KeyBanc Capital Markets, Mizuho Securities, RBC Capital Markets and UBS Investment Bank. Underwriters have a 30-day option on another 1.2 million units.
The company expects to use proceeds of approximately $208 million from the offering to repay amounts owed under a $313 million term loan. A subsidiary of NextEra Energy has agreed to purchase directly from NextEra Energy Operating Partners $702 million of its common units at the offering price paid by purchasers in the public offering in a private placement. NextEra Energy Operating Partners intends to use the proceeds of the private placement to repay the amounts remaining under the term loan after application of the proceeds of the public offering, and intends to use the balance of the proceeds from the private placement to finance a portion of the NET Midstream acquisition and for general partnership purposes.
At $26 per common unit, the private placement reflects an additional 27 million units.
Common units of NextEra Energy Partners traded up about 0.4% Friday morning, at $26.29 in a 52-week range of $24.75 to $48.23.
Shares of NextEra Energy closed up fractionally on Thursday to $95.35 and were inactive Friday morning. The stock’s 52-week range is $90.33 to $112.64.
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