Emera greenshoe lifts 4% 10-year convertibles deal to C$2.19 billion

By Susanna Moon

Chicago, Oct. 2 – Emera Inc. said underwriters fully exercised the C$285 million over-allotment option on the 4% 10-year convertible subordinated debentures issued by wholly owned subsidiary Emera Holdings NS Co.

This brings the total deal size to C$2,185,000,000, according to a company press release.

Emera priced C$1.9 billion of the convertibles on Sept. 8 in a secondary offering on a bought deal basis to yield 4%.

As previously reported, the debentures are being sold on an installment basis at a price of C$1,000 per debenture, of which C$333 is payable on the closing of the offering and the remaining C$667 is payable at a future date after the closing of Emera’s planned acquisition of TECO Energy Inc., the Tampa, Fla.-based energy-related holding company with regulated electric and gas utilities in Florida and New Mexico.

Halifax, N.S.-based Emera is buying TECO for $10.4 billion, including assumption of about $3.9 billion of debt.

Prior to the final installment date, the debentures will be represented by installment receipts. Application will be made to list the installment receipts on the Toronto Stock Exchange. The debentures will not be listed.

A syndicate of underwriters for the offering is being co-led by Scotiabank, RBC Capital Markets and J.P. Morgan Securities Canada Inc., and includes CIBC World Markets Inc., TD Securities Inc., BMO Capital Markets, National Bank Financial Inc., Barclays Capital Canada Inc. and Credit Suisse Securities (Canada) Inc.

Proceeds are being used to finance, directly or indirectly, the acquisition of TECO Energy and other acquisition-related expenses.

At maturity, Emera will have the right to pay the principal amount due in common shares, which will be valued at 95% of their weighted average trading price on the Toronto Stock Exchange for the 20 consecutive trading days ending five trading days preceding the maturity date.

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