NRG Yield greenshoe lifts 3.5% five-year convertibles to $345 million

By Susanna Moon

Chicago, Feb. 28 - NRG Yield Inc. said underwriters fully exercised the $45 million over-allotment option on its 3.5% five-year convertible senior notes, bringing the total deal size to $345 million.

As previously announced, NRG Yield priced $300 million of the convertibles at par after the market close on Feb. 5 to yield 3.5% with an initial conversion premium of 27.5%.

Pricing came at the cheap end of talk, which was for a 3% to 3.5% coupon and a 27.5% to 32.5% premium.

The Rule 144A offering was sold via joint bookrunners Morgan Stanley & Co. LLC, BofA Merrill Lynch, RBC Capital Markets and Goldman Sachs & Co.

The notes are fully and unconditionally guaranteed on a senior basis by NRG Yield LLC and NRG Yield Operating LLC, the direct and indirect subsidiaries of the company.

NRG Yield will lend proceeds from this offering to Yield Operating LLC, which will allocate the funds for working capital and general corporate purposes, including the acquisition of assets from NRG Energy Inc. or other third parties.

The convertibles are non-callable. They have net share settlement and contingent conversion if shares exceed 130% of the conversion price. They also have takeover protection and dividend protection at a current dividend of 33.5 cents, and then rising on a sliding scale at 15% annually.

Princeton, N.J.-based NRG Yield is an electricity generator with natural gas or dual-fired facilities, as well as solar and wind generation.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.