By Stephanie N. Rotondo
Phoenix, March 7 - Prudential Financial Inc. priced $650 million of 5.7% $25-par junior subordinated notes due March 15, 2053, according to a market source on Thursday.
Wells Fargo Securities LLC, BofA Merrill Lynch, Citigroup Global Markets Inc., Morgan Stanley & Co. LLC and UBS Securities LLC are the joint bookrunners.
Interest will be payable on the 15th day of March, June, September and December, beginning June 15. The company has the right to defer payments for one or more consecutive periods up to five years. However, that will result in those payments becoming cumulative and compounding. If all of those payments are not thus made, it is considered a default.
The notes can be redeemed prior to March 15, 2018, in whole, within 90 days of a tax event or a rating agency event at par plus accrued interest plus a "make-whole" premium of Treasuries plus 40 bps. In the case of a regulatory capital even, the call price is par plus accrued interest.
Otherwise, the notes cannot be redeemed until March 15, 2018.
Prudential intends to list the new notes on the New York Stock Exchange.
Proceeds will be used for general corporate purposes, which may include the redemption of the 9% junior subordinated notes due 2068.
Prudential is a Newark, N.J.-based financial services provider.
| Issuer: | Prudential Financial Inc.
|
| Securities: | Junior subordinated notes
|
| Amount: | $650 million, upsized from $250 million
|
| Maturity: | March 15, 2053
|
| Bookrunners: | Wells Fargo Securities LLC, BofA Merrill Lynch, Citigroup Global Markets Inc., Morgan Stanley & Co. LLC, UBS Securities LLC
|
| Coupon: | 5.7%
|
| Price: | Par of $25
|
| Yield: | 5.7%
|
| Talk: | Around 5.75%
|
| Call options: | Prior to March 15, 2018 in the case of a tax event or rating agency event at par plus accrued plus a "make-whole" premium, in whole but not in part; or in the case of a regulatory capital treatment event at par plus accrued; on or after March 15, 2018 in whole or in part at par plus accrued
|
| Make-whole premium: | Treasuries plus 40 bps
|
| Pricing date: | March 7
|
| Settlement date: | March 14
|
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