By Cristal Cody
Tupelo, Miss., Aug. 15 – South Carolina Electric & Gas Co. priced $700 million of first mortgage bonds (Baa1/BBB+/BBB) in two tranches on Wednesday, according to an FWP filing with the Securities and Exchange Commission.
The company sold $300 million of 3.5% three-year bonds at 99.997 to yield 3.501%, or a spread of Treasuries plus 83 basis points.
A $400 million tranche of 4.25% 10-year bonds priced at 99.75 to yield 4.281% and a Treasuries plus 143 bps spread.
Both tranches priced on the tight side of guidance. The deal was upsized from $600 million.
J.P. Morgan Securities LLC, BofA Merrill Lynch, Morgan Stanley & Co. LLC and Wells Fargo Securities LLC were the bookrunners.
Proceeds will be used to pay at or prior to maturity $250 million of the company’s 5.25% first mortgage bonds due Nov. 1, 2018 and $300 million of 6.5% first mortgage bonds due Nov. 1, 2018, to repay borrowings under a credit agreement and other short-term debt and for general corporate purposes.
South Carolina Electric & Gas is a regulated utility based in Cayce, S.C.
| Issuer: | South Carolina Electric & Gas Co.
|
| Amount: | $700 million
|
| Description: | First mortgage bonds
|
| Bookrunners: | J.P. Morgan Securities LLC, BofA Merrill Lynch, Morgan Stanley & Co. LLC and Wells Fargo Securities LLC
|
| Co-managers: | FTN Financial Securities Corp. and Svnovus Securities, Inc.
|
| Trade date: | Aug. 15
|
| Settlement date: | Aug. 17
|
| Ratings: | Moody’s: Baa1
|
| S&P: BBB+
|
| Fitch: BBB
|
| Distribution: | SEC registered
|
|
|
| Three-year bonds
|
| Amount: | $300 million
|
| Maturity: | Aug. 15, 2021
|
| Coupon: | 3.5%
|
| Price: | 99.997
|
| Yield: | 3.501%
|
| Spread: | Treasuries plus 83 bps
|
| Call feature: | Make-whole call at Treasuries plus 15 bps
|
| Price guidance: | Treasuries plus 85 bps area, plus or minus 2 bps; initial price talk at Treasuries plus 120 bps area
|
|
|
| 10-year bonds
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| Amount: | $400 million
|
| Maturity: | Aug. 15, 2028
|
| Coupon: | 4.25%
|
| Price: | 99.75
|
| Yield: | 4.281%
|
| Spread: | Treasuries plus 143 bps
|
| Call feature: | Make-whole call before May 15, 2028 at Treasuries plus 25 bps; thereafter at par
|
| Price guidance: | Treasuries plus 145 bps area, plus or minus 2 bps; initial price talk at Treasuries plus 175 bps area
|
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