National Grid plans to sell £350 million five-year convertible bonds to yield 0.5%-1.3%, up 30%

By Rebecca Melvin

New York, Sept. 24 – National Grid North America Inc., a subsidiary of National Grid plc, plans to price £350 million of five-year convertible bonds at par that are being talked to yield 0.5% to 1.3% with an initial conversion premium of 30% over the share reference price, according to a company news release.

The Regulation S deal has a £50 million upsize option.

Pricing will be determined by a volume-weighted average price of ordinary shares on the London Stock Exchange over 10 consecutive trading days starting Friday. The reference price and initial conversion price will be announced Oct. 8.

The bonds will be cash-settled. And concurrently with the bond issue, National Grid North America will purchase cash-settled call options on National Grid’s ordinary shares to hedge its exposure to pay cash amounts upon any exercise of conversion rights.

Proceeds are intended for general corporate purposes and for the purchase of cash-settled call options.

The bonds are expected to be listed on the open market segment of the Frankfurt Stock Exchange.

London-based National Grid is a multinational electricity and gas utility.

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