CenterPoint Energy talks $900 million three-year convertibles to yield 3.875%-4.375%, up 25%-30%

By Abigail W. Adams

Portland, Me., Aug. 1 – CenterPoint Energy Inc. plans to price $900 million of three-year convertible notes after the market close on Tuesday with price talk for a coupon of 3.875% to 4.375% and an initial conversion premium of 25% to 30%, according to a market source.

J.P. Morgan Securities LLC, Goldman Sachs & Co. LLC and Wells Fargo Securities LLC are bookrunners for the Rule 144A offering, which carries a greenshoe of $100 million.

The notes are non-callable.

The convertibles will be settled in cash up to the principal amount with any remaining amount to be settled in cash, shares or a combination of both at the company’s option.

Proceeds will be used for general corporate purposes, including the redemption of the company’s series A preferred stock after its call date and the repayment of a portion of its commercial paper.

CenterPoint Energy is a Houston-based utility company.

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