S&P rates Southern Co. notes BBB

S&P said it assigned its BBB rating to two tranches of Southern Co.'s junior subordinated notes, totaling $1.725 billion, due in 2024, and 2027, respectively, based on a review of the proposed terms and conditions.

Southern Co. originally issued the notes as components of its 2019 equity units, and they are subordinated to the company's senior unsecured debt.

“Because of this subordination, and because of the lack of a coupon deferral mechanism for these instruments, we rate them in line with the senior unsecured debt, which is one notch below our BBB+ issuer credit rating on Southern Co.,” S&P said in a press release.

The rating is one notch higher than the rating on Southern's junior subordinated notes classified as hybrid securities based on their permanence, deferability and subordination features, the agency said.

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