Algonquin Power talks $900 million equity units to yield 7.375%-7.875%, up 17.5%-22.5%

By Abigail W. Adams

Portland, Me., June 16 – Algonquin Power & Utilities Corp. plans to price $900 million three-year par-of-$50 equity units after the market close on Thursday with price talk for a coupon of 7.375% to 7.875% and an initial conversion premium of 17.5% to 22.5%, according to a market source.

J.P. Morgan Securities LLC (lead left), BMO Capital Markets Corp., Wells Fargo Securities LLC, Morgan Stanley & Co. LLC and BofA Securities Inc. are joint bookrunners for the registered offering, which carries a greenshoe of $135 million.

The units consist of a forward stock purchase contract due on June 15, 2024 and a 1/20th interest in the company’s par-of-$1,000 remarketable senior notes due June 15, 2026.

The units are non-callable.

They are putable upon a fundamental change.

There is dividend protection above $0.17 a quarter.

Proceeds will be used to finance or refinance investments in renewable energy generation or clean energy technologies.

Algonquin Power is an Oakville, Ont.-based renewable energy utility.

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