Published on 3/21/2023 in the Prospect News Investment Grade Daily.
New Issue: Duke Energy Indiana sells $500 million 5.4% 30-year bonds at 170 bps over Treasuries
By William Gullotti
Buffalo, N.Y., March 21 – Duke Energy Indiana, LLC sold $500 million of 5.4% 30-year first mortgage bonds (Aa3/A) at a spread of 170 basis points over Treasuries on Tuesday, according to an FWP filing and a 424B5 filing with the Securities and Exchange Commission.
The notes priced at 99.91 to yield 5.406%.
The notes feature a make-whole call at Treasuries plus 30 bps until Oct. 1, 2052 and a par call thereafter.
BofA Securities, Inc., Citigroup Global Markets Inc., SMBC Nikko Securities America, Inc., TD Securities (USA) LLC, Truist Securities, Inc., Credit Suisse Securities (USA) LLC and Mizuho Securities USA LLC were the joint bookrunning managers.
Proceeds will be used to repay the company’s $300 million term loan due October 2023, to pay down a portion of outstanding intercompany short-term debt and for general corporate purposes. As of Jan. 31, there were $698.6 million of outstanding short-term money-pool borrowings at an annual interest rate of 4.65%.
The electricity provider is based in Plainfield, Ind.
| Issuer: | Duke Energy Indiana, LLC
|
| Amount: | $500 million
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| Issue: | Series AAAA first mortgage bonds
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| Maturity: | April 1, 2053
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| Bookrunners: | BofA Securities, Inc., Citigroup Global Markets Inc., SMBC Nikko Securities America, Inc., TD Securities (USA) LLC, Truist Securities, Inc., Credit Suisse Securities (USA) LLC and Mizuho Securities USA LLC
|
| Co-managers: | Regions Securities LLC, Academy Securities, Inc., Great Pacific Securities, Mischler Financial Group, Inc. and Samuel A. Ramirez & Co., Inc.
|
| Trustee: | Deutsche Bank National Trust Co.
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| Counsel to issuer: | Hunton Andrews Kurth LLP and in-house counsel
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| Counsel to underwriters: | Sidley Austin LLP
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| Coupon: | 5.4%
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| Price: | 99.91
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| Yield: | 5.406%
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| Spread: | Treasuries plus 170 bps
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| Call features: | Make-whole call at price equal to greater of par and Treasuries plus 30 bps before Oct. 1, 2052; thereafter at par
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| Trade date: | March 21
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| Settlement date: | March 23
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| Ratings: | Moody’s: Aa3
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| S&P: A
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| Distribution: | SEC registered
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| Cusip: | 26443TAD8
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