NiSource greenshoe lifts three-year equity units to $862.5 million

By Rebecca Melvin

Concord, N.H., April 20 – Underwriters for NiSource Inc.’s three-year par-of-$100 equity units fully exercised their $112.5 million greenshoe, increasing the total deal size of corporate units to $862.5 million, according to an 8-K filed with the Securities and Exchange Commission.

The greenshoe was exercised concurrently with closing of the $750 million base deal for a total sale of 8,625,000 corporate units, which closed on April 19.

As previously reported, the securities priced at the cheap end of talk with a payment of 7.75% and a threshold appreciation premium of 17.5%.

Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC and Wells Fargo Securities LLC were bookrunners for the registered offering.

The units consist of a stock purchase agreement and a 10% interest in one share of par-of-$1,000 series C mandatory convertible preferred stock.

The purchase contracts will settle on Dec. 1, 2023, and the mandatory convertible preferred stock will convert on March 1, 2024.

The preferred stock is convertible only after it is separated from the purchase contract and will pay dividends following remarketing.

The equity units will satisfy all equity needs of the company through 2024 and eliminates the need for the equity issuance initially planned for 2022 or 2023.

The proceeds will be used for renewable generation investments and general corporate purposes, which may include working capital and repayment of debt.

NiSource is a Merrillville, Ind.-based utility company.

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