By Abigail W. Adams
Portland, Me., March 15 – American Electric Power Co. Inc. priced $700 million, or 14 million units, of $50-par three-year equity units after the market close Thursday with a dividend of 6.125% and an initial conversion premium of 20%, according to an FWP filing with the Securities and Exchange Commission.
Pricing came at the rich end of talk for a dividend 6.125% to 6.625% and at the midpoint of talk for an initial conversion premium of 17.5% to 22.5%, according to a market source.
Barclays, Morgan Stanley & Co. LLC and Wells Fargo Securities LLC are joint bookrunners for the registered offering, which carries a greenshoe of $105 million, or 2.1 million units.
The equity units will consist of a contract to purchase common stock and a 1/20 interest in a $1,000-par 3.4% junior subordinated debenture due March 15, 2024.
The units will be listed for trade on the New York Stock Exchange under the ticker “AEPPrB”.
Net proceeds are expected to be $682 million. Proceeds will be used for the company’s capital expenditure plan, including its renewable energy program.
American Electric Power is a Columbus, Ohio-based electric utility.
| Issuer: | American Electric Power Co. Inc.
|
| Securities: | Mandatory equity units
|
| Amount: | $700 million, or 14 million units
|
| Greenshoe: | $105 million, or 2.1 million units
|
| Maturity: | March 15, 2022
|
| Bookrunners: | Barclays, Morgan Stanley & Co. LLC and Wells Fargo Securities LLC
|
| Dividend: | 6.125%
|
| Price: | Par of $50.00
|
| Yield: | 6.125%
|
| Conversion premium: | 20%
|
| Threshold appreciation: | $99.58
|
| Conversion rate: | Minimum of 0.5201 and maximum of 0.6026
|
| Call options: | None
|
| Put options: | None
|
| Pricing date: | March 14
|
| Settlement date: | March 19
|
| Distribution: | Registered
|
| Talk: | Dividend of 6.125% to 6.625% and an initial conversion premium of 17.5% to 22.5%
|
| Listing: | NYSE: AEPPrB
|
| Stock symbol: | NYSE: AEP
|
| Stock price: | $82.98 at market close March 15
|
| Market capitalization: | $40.93 billion
|
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