By Aleesia Forni
Virginia Beach, Aug. 10 – Duke Energy Progress Inc. priced an upsized $1.2 billion two-part offering of first mortgage bonds (Aa2/A/A+) on Monday in tranches due 2025 and 2045, according to a market source and an FWP filed with the Securities and Exchange Commission.
The offering was upsized from a planned $1 billion.
There was $500 million of 3.25% 10-year notes priced at 99.695 to yield 3.286%, or Treasuries plus 105 basis points.
The notes were talked in the range of Treasuries plus 115 bps to 120 bps.
Also priced was $700 million of 4.2% 30-year notes at 99.493 to yield 4.23%, or Treasuries plus 130 bps.
Pricing was tighter than talk, which was set at Treasuries plus 140 bps to 145 bps.
Credit Suisse Securities (USA) LLC, RBC Capital Markets LLC, SunTrust Robinson Humphrey Inc., UBS Securities LLC and Wells Fargo Securities LLC are the bookrunners.
Proceeds will be used to repay short-term debt under the company’s money-pool borrowing arrangement with Duke Energy Corp., to repay $400 million of 5.25% mortgage bonds due Dec. 15, 2015 and for general corporate purposes.
Raleigh, N.C.-based Duke Energy Progress generates and distributes electricity in North Carolina and South Carolina.
| Issuer: | Duke Energy Progress Inc.
|
| Issue: | First mortgage bonds
|
| Amount: | $1.2 billion, upsized from $1 billion
|
| Bookrunners: | Credit Suisse, RBC Capital Markets LLC, SunTrust Robinson Humphrey Inc., UBS Securities LLC, Wells Fargo Securities LLC
|
| Co-managers: | BBVA Securities Inc., Credit Agricole Securities (USA) Inc., Fifth Third Securities, Inc., Lloyds Securities Inc., PNC Capital Markets LLC, Santander Investment Securities Inc.
|
| Trade date: | Aug. 10
|
| Settlement date: | Aug. 13
|
| Ratings: | Moody’s: Aa2
|
| Standard & Poor’s: A
|
| Fitch: A+
|
| Distribution: | SEC registered
|
|
|
| 10-year notes
|
| Amount: | $500 million
|
| Maturity: | Aug. 15, 2025
|
| Coupon: | 3.25%
|
| Price: | 99.695
|
| Yield: | 3.286%
|
| Spread: | Treasuries plus 105 bps
|
| Price talk: | Treasuries plus 115 bps to 120 bps
|
| Make-whole call: | Treasuries plus 20 bps prior to May 15, 2025, then callable at par
|
|
|
| 30-year bonds
|
| Amount: | $700 million
|
| Maturity: | Aug. 15, 2045
|
| Coupon: | 4.2%
|
| Price: | 99.493
|
| Yield: | 4.23%
|
| Spread: | Treasuries plus 130 bps
|
| Price talk: | Treasuries plus 140 bps to 145 bps
|
| Make-whole call: | Treasuries plus 20 bps prior to Feb. 15, 2045, then callable at par
|
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