By Ronda Fears
Nashville, May 13 - CenterPoint Energy Inc. upsized its convertible deal to $500 million from $400 million, and sold the 20-year convertible notes after the close Tuesday at par to yield 3.75% with a 50% initial conversion premium, via joint lead managers Banc of America Securities, Citigroup and JPMorgan.
Guidance for the issue had been tightened before pricing, putting the yield at 3.75% to 4.0% yield with a 45% to 50% initial conversion premium. The 20-year notes had been talked to yield 4.0% to 4.5% with a 40% to 45% initial conversion premium.
Even with the revised price talk, the issue closed in the gray market at 3.5 points over issue price on the bid side and 4 points over on the offer.
CenterPoint Energy said it plans to use proceeds to repay outstanding borrowings under its $3.8 billion credit facility.
Terms of the deal are:
Issuer: CenterPoint Energy Inc.
| Issue: | Convertible senior unsecured notes
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| Joint lead managers: | Banc of America Securities, Citigroup and JPMorgan
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| Amount | $500 million, upped from $400 million
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| Greenshoe: | $75 million, upped from $60 million
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| Maturity: | May 15, 2023
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| Coupon: | 3.75%
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| Price: | Par
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| Yield: | 3.75%
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| Conversion premium: | 50%
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| Conversion price: | $11.58
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| Conversion ratio: | 86.3558
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| Call: | Non-callable for five years
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| Put: | In years 5, 10 and 15 in cash only
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| Contingent conversion: | 120%, stepping to 110% at year five
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| Contingent payment: | 120%
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| Expected ratings: | Moody's: Baa3
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| S&P: BBB-
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| Settlement: | May 19
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