Published on 9/6/2022 in the Prospect News Investment Grade Daily.
New Issue: Southern Co. Gas prices $500 million 5.15% notes due 2032 at 99.72
By Marisa Wong
Los Angeles, Sept. 6 – Southern Co. Gas Capital Corp., a wholly owned subsidiary of Southern Co. Gas, priced $500 million of 5.15% series 2022A fixed-rate senior notes (Baa1/BBB+/BBB+) on Tuesday, according to an FWP filing with the Securities and Exchange Commission. The parent company is guarantor of the notes.
The notes priced at 99.72 to yield 5.186%, or a spread of 185 basis points over Treasuries.
The notes will feature a make-whole call followed by a par call six months before the maturity date.
BofA Securities, Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, RBC Capital Markets, LLC and U.S. Bancorp Investments, Inc. are the joint bookrunners.
Proceeds will be used to repay all or a portion of the issuer’s commercial paper borrowings, which totaled $377 million as of Sept. 2. Any remaining proceeds will be used for other general corporate purposes, which may include investment in subsidiaries.
Southern is an Atlanta-based gas and electric company.
| Issuer: | Southern Co. Gas Capital Corp.
|
| Guarantor: | Southern Co. Gas
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| Amount: | $500 million
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| Issue: | Senior notes, series 2022A
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| Maturity: | Sept. 15, 2032
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| Bookrunners: | BofA Securities, Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, RBC Capital Markets, LLC and U.S. Bancorp Investments, Inc.
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| Co-managers: | Santander Investment Securities Inc., BBVA Securities Inc., CIBC World Markets Corp., Huntington Securities, Inc., Loop Capital Markets LLC, Cabrera Capital Markets LLC, CastleOak Securities, LP and Penserra Securities LLC
|
| Trustee: | Computershare Trust Co., NA
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| Counsel to issuer: | Troutman Pepper Hamilton Sanders LLP, Woodburn and Wedge (Nevada)
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| Counsel to underwriters: | Hunton Andrews Kurth LLP
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| Coupon: | 5.15%
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| Price: | 99.72
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| Yield: | 5.186%
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| Spread: | Treasuries plus 185 bps
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| Call features: | Make-whole call at Treasuries plus 30 bps prior to March 15, 2032; par call after that
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| Trade date: | Sept. 6
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| Settlement date: | Sept. 9
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| Ratings: | Moody’s: Baa1
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| S&P: BBB+
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| Fitch: BBB+
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| Distribution: | SEC registered
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| Cusip: | 8426EPAF5
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