By Rebecca Melvin
New York, June 4 - Dominion Resources Inc. priced $1 billion of three-year mandatory convertible equity units in two tranches at a 2% discount to their $50 par in a registered, off-the-shelf deal via joint bookrunners J.P. Morgan Securities LLC, BofA Merrill Lynch, Goldman Sachs & Co. and UBS Investment Bank.
The 20 million of equity units priced at the cheap end of talk after the market close Monday. Each series has a $50 million over-allotment option.
The 10 million of series A units have a 6.125% distribution rate and a 17.5% initial conversion premium, compared to the talked distribution rate of 5.625% to 6.125% and 17.5% to 22.5% premium. The A series mature April 1, 2016, and initially consist of a purchase contract and a 1/20 undivided beneficial ownership interest in $1,000 principal amount of the 2013 series A 1.07% remarketable subordinated notes due 2021. The units are expected to be listed on the New York Stock Exchange under the symbol DCUA.
The 10 million of series B units have a 6% distribution rate and 17.55% premium, which compared to a talked distribution rate of 5.5% to 6% and premium of 17.5% to 22.5%. They mature July 1, 2016 and will consist initially of a purchase contract and a 1/20 undivided beneficial ownership interest in $1,000 principal amount of 2013 series B 1.18% remarketable subordinated notes due 2019.
Both series of units will be non-callable for life with no puts and will have takeover and dividend protection.
Proceeds will be used for general corporate purposes and to fund its growth plan, including the Cove Point liquefaction project.
Dominion is a Richmond, Va.-based energy company.
| Issuer: | Dominion Resources Inc.
|
| Issue: | Mandatory convertible equity units
|
| Amount: | $1 billion (20 million units)
|
| Bookrunners: | J.P. Morgan Securities LLC, BofA Merrill Lynch, Goldman Sachs & Co., UBS Investment Bank
|
| Price: | $49.00, discount from $50.00 par
|
| Threshold appreciation price: | $65.2742
|
| Minimum settlement rate: | 0.7660 shares
|
| Maximum settlement rate: | 0.9001 shares
|
| Pricing date: | June 3
|
| Settlement date: | June 7
|
| Stock symbol: | NYSE: D
|
| Stock reference price: | $55.55 as of close June 4
|
| Market capitalization: | $32.1 billion
|
| Distribution: | Registered, off the shelf
|
|
|
| Series A units
|
| Amount: | $500 million (10 million units)
|
| Greenshoe: | $50 million (1 million units)
|
| Maturity: | April 1, 2016
|
| Distribution rate: | 6.125%
|
| Premium: | 17.5%
|
| Price talk: | $49.00 discount, 5.625%-6.125%, up 17.5%-22.5%
|
| Ticker symbol: | NYSE: DCUA
|
|
|
| Series B units
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| Amount: | $500 million (10 million units)
|
| Grenshoe: | $50 million (1 million units)
|
| Maturity: | July 1, 2016
|
| Distribution rate: | 6%
|
| Premium: | 17.5%
|
| Price talk: | $49.00 discount, 5.5%-6%, up 17.5%-22.5%
|
| Ticker symbol: | NYSE: DCUB
|
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