NextEra talks $900 million three-year exchangeable notes to yield 2.75%-3.25%, up 22.5%-27.5%

By Abigail W. Adams

Portland, Me., Feb. 27 – NextEra Energy Capital Holdings Inc. plans to price $900 million of three-year exchangeable notes (expected Baa1/BBB+/A-) after the market close on Tuesday with price talk for a coupon of 2.75% to 3.25% and an initial exchange premium of 22.5% to 27.5%, according to a market source.

Citigroup Global Markets Inc., BofA Securities Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, Mizuho Securities USA Inc. and Wells Fargo Securities LLC are bookrunners for the Rule 144A offering, which carries a greenshoe of $100 million.

The notes are non-callable.

They are putable upon a fundamental change.

There is dividend protection above 51.5 cents per quarter.

The notes will be settled in cash up to the principal amount with any remaining amounts to be settled in cash, shares or a combination of both at the company’s option with NextEra currently expecting to settle remaining amounts in cash.

In connection with the offering, the company will enter into capped call transactions.

Proceeds will be used to fund the cost of the call spread, to fund investments in energy and power projects, and for general corporate purposes, which may include repayment of a portion of its commercial paper.

NextEra Energy is a Juno Beach, Fla.-based clean energy company.

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