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Great Plains Energy’s $750 million 7% $50-par mandatory convertible preferreds admitted to NYSE
By Stephanie N. Rotondo
Seattle, Oct. 18 – Great Plains Energy Inc.’s $750 million offering of 7% $50-par series B mandatory convertible preferred stock began trading on the New York Stock Exchange on Tuesday under the ticker symbol “GXPPB.”
The deal came Sept. 27 with an initial conversion premium of 20%, compared to the 17.5% to 22.5% talk. The yield priced at the tight end of the 7% to 7.5% talk.
Great Plains also raised $1.4 billion via a concurrent offering of 52.6 million shares of common stock.
The proceeds of both offerings will be used to finance a portion of the cash consideration for the company’s previously announced acquisition of Westar Energy Inc.
Goldman Sachs & Co. was lead bookrunning manager of the concurrent offerings. Barclays and Wells Fargo Securities LLC were the joint bookrunners on the preferred offering.
The convertible preferreds are mandatorily convertible on Sept. 15, 2019.
Should the aforementioned merger fail to go through, or if it should not be completed by 5 p.m. ET on Nov. 30, 2017, the preferreds will be redeemed in full at par plus a make-whole amount within 10 business days.
The preferreds are convertible at a threshold appreciation price of $31.74.
Holders of the preferreds can also elect to convert the securities early upon a fundamental change. In such a case, holders will receive a make-whole premium amount calculated using a 4.25% discount rate on top of the initial conversion rate.
Kansas City, Mo.-based Great Plains is the holding company of Kansas City Power & Light Co. and KCP&L Greater Missouri Operations Co.
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