Entergy plans to price up to $500 million of mandatory convertibles

By Rebecca Melvin

Princeton, N.J., Dec. 2 - Entergy Corp. plans to price up to $500 million of mandatory convertible equity units, according to a filing with the Securities and Exchange Commission Friday.

The $50 equity units will mature Feb. 17, 2009.

Citigroup is bookrunner for the offering.

Entergy is a New Orleans-based electric utility, temporarily headquartered in Clinton, Miss., due to the devastation to the region caused by Hurricanes Katrina and Rita.

The company is implementing a financing plan of about $2.5 billion to provide liquidity and capital resources while storm restoration cost recovery is underway and to provide additional financial support against potential unexpected events, the company said in the filing.

The plan is also intended to provide liquidity and capital resources to support the non-utility nuclear and competitive retail services businesses.

The plan includes the equity units, a new revolving credit facility and other new debt.

The new Entergy revolving credit facility with capacity of up to $1.5 billion would supplement an existing $2 billion five-year revolver. The issuance and sale of up to $500 million of new debt at Entergy Gulf States and Entergy Louisiana includes $150 million of first mortgage bonds issued by Entergy Louisiana on Oct. 21.

In addition to the financing plan, Entergy Corp. plans to provide funding of $300 million to Entergy Gulf States.

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