By Paul A. Harris
St. Louis, June 9 - CMS Energy Corp. priced a $300 million issue of non-callable 8¾% 10-year senior unsecured notes (Ba1/BB+/BB+) at 98.374 to yield 9% on Tuesday, according to an informed source.
The deal priced on top of the 9% area price talk.
Although it was transacted off the high-yield desk, between one-third and one-fourth of the accounts that participated were high-grade investors, the source said.
Barclays Capital Inc. and Deutsche Bank Securities Inc. were active bookrunners for the Securities and Exchange Commission-registered deal. Banc of America Securities LLC, Citigroup Global Markets Inc. and UBS Investment Bank were passive bookrunners.
Proceeds will be used for general corporate purposes, including the retirement of existing debt.
The energy company is based in Jackson, Mich.
| Issuer: | CMS Energy Corp.
|
| Face amount: | $300 million
|
| Proceeds: | $295.122 million
|
| Maturity: | June 15, 2019
|
| Security description: | Senior unsecured notes
|
| Active bookrunners: | Barclays Capital Inc., Deutsche Bank Securities Inc.
|
| Passive bookrunners: | Banc of America Securities LLC, Citigroup Global Markets Inc., UBS Investment Bank
|
| Co-managers: | Wedbush Morgan, Credit Suisse, Daiwa, Huntington Investment Co.
|
| Coupon: | 8¾%
|
| Price: | 98.374
|
| Yield: | 9%
|
| Spread: | 514 bps
|
| Call protection: | Non-callable; make-whole provision at Treasuries plus 75 bps
|
| Trade date: | June 9
|
| Settlement date: | June 15
|
| Ratings: | Moody's: Ba1
|
| Standard & Poor's: BB+
|
| Fitch: BB+
|
| Distribution: | Off shelf
|
| Price talk: | 9% area
|
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