New Issue: PPL Energy sells upsized $350 million convert at 2.625%, up 30%

By Ronda Fears

Nashville, May 16 - PPL Energy Supply LLC sold an upsized $350 million of 20-year convertibles, which convert into parent PPL Corp. shares and are guaranteed by PPL at par to yield 2.625% with a 30% initial conversion premium, via joint lead mangers Merrill Lynch & Co., Morgan Stanley and Wachovia Securities.

The Rule 144A issue, upped from $300 million, priced at the middle of guidance which put the yield at 2.5% to 3.0% with a 27.5% to 32.5% initial conversion premium.

Also Thursday, PPL Corp. sold 6.5 million shares at $38.25 for another $249 million. PPL Corp. said it would distribute the proceeds to PPL Energy Supply, augmenting the proceeds from the convertible, to be used to repurchase its commercial paper, and general corporate purposes.

Terms of the deal are:

Issuer: PPL Energy Supply LLC

Issue:	Convertible senior notes
Lead manager:	Merrill Lynch & Co., Morgan Stanley and Wachovia Securities
Amount	$350 million, upped from $300 million
Greenshoe:	$50 million, up from $45 million
Maturity:	May 15, 2028
Coupon:	2.625%
Price:	Par
Yield:	2.625%
Conversion premium:	30%
Conversion price:	$49.725
Conversion ratio:	20.1106
Call:	May 20, 2008
Put:	In years 5, 10 and 15
Contingent conversion:	120% for life
Expected ratings:	Moody's: Baa2
	S&P: BBB
Settlement:	May 21

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