NRG prices $500 million convertible preferreds to yield 5.75%

New York, Jan. 25 - NRG Energy, Inc. said it priced $500 million of mandatory convertible preferred stock with a 5.75% dividend.

The company did not disclose the conversion price.

Price talk was for a yield of 5.75% to 6.25% and an initial conversion premium of 20% to 24%.

The convertibles were made up of 2 million shares at $250 each. NRG also sold 20,855,057 shares at $48.75 per share.

There is a 15% over-allotment option for each tranche.

The offering is being sold via joint bookrunners Citigroup Global Markets and Morgan Stanley.

Proceeds from the convertibles, stock and $2.6 billion of junk bonds will be used to finance NRG's previously announced acquisition of Texas Genco LLC.

Princeton, N.J.-based NRG Energy is an energy company that owns and operates power plants in the U.S. northeast, south central and western regions.

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