Published on 8/18/2015 in the Prospect News Investment Grade Daily and Prospect News Preferred Stock Daily.
New Issue: SoCal Edison unit prices $325 million 5.375% fixed-to-floating trust securities at par
By Stephanie N. Rotondo
Phoenix, Aug. 18 – Southern California Edison Co.’s SCE Trust IV sold $325 million of 5.375% fixed-to-floating rate trust preference securities (expected ratings: Baa1/BBB-/BBB+) on Monday, according to an FWP filed Tuesday with the Securities and Exchange Commission.
Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC and RBC Capital Markets are the active bookrunners. BNY Mellon Capital Markets LLC and BNP Paribas Securities Corp. are the passive bookrunners.
Each preference share represents an undivided beneficial interest in the trust’s only asset, the series J preference shares. Distributions on the new issue will only be made if dividends are paid on the series Js.
When declared, distributions will be payable quarterly at a fixed rate until Sept. 15, 2025, when the distribution rate will begin to float at Libor plus 313.2 basis points.
The shares become redeemable Sept. 15, 2025 or upon a certain changes in tax law, investment company law or interpretations at par plus accrued distributions.
The Rosemead, Calif.-based subsidiary of Edison International will use the proceeds to redeem all outstanding series A floating-rate noncumulative preference shares and for general corporate purposes.
| Issuer: | SCE Trust IV
|
| Guarantor: | Southern California Edison Co.
|
| Securities: | Fixed-to-floating rate trust preference securities
|
| Amount: | $325 million, or 13 million shares
|
| Maturity: | Perpetual
|
| Bookrunners: | Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC, RBC Capital Markets, BNY Mellon Capital Markets LLC, BNP Paribas Securities Corp.
|
| Co-managers: | MUFG, Mizuho Securities USA Inc., SunTrust Robinson Humphrey Inc., CastleOak Securities LP, Samuel A. Ramirez & Co. Inc., MFR Securities Inc., CAVU Securities LLC
|
| Distribution rate: | Fixed at 5.375% until Sept. 15, 2025, then floating at Libor plus 313.2 bps
|
| Price: | Par of $25.00
|
| Yield: | 5.375%
|
| Talk: | Initially around 5%, then revised to 5.375% to 5.5%
|
| Call options: | On or after Sept. 15, 2025 or upon certain changes in tax law, investment company law or interpretations at par plus accrued distributions
|
| Pricing date: | Aug. 17
|
| Settlement date: | Aug. 24
|
| Expected ratings: | Moody’s: Baa1
|
| Standard & Poor’s: BBB-
|
| Fitch: BBB+
|
| Expected listing: | NYSE: SCEPJ
|
| Cusip: | 78409G206
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
