CenterPoint Energy greenshoe increases 4.25% convertibles to $1 billion

By Wendy Van Sickle

Columbus, Ohio, Aug. 4 – Underwriters for CenterPoint Energy Inc.’s 4.25% convertible notes fully exercised their $100 million greenshoe, lifting the total size of the deal to $1 billion, according to an 8-K filing with the Securities and Exchange Commission.

As previously reported, the company priced $900 million of the convertibles on Aug. 1 at par with an initial conversion premium of 25%

Pricing came toward the cheap end of talk for a coupon of 3.875% to 4.375% and at the cheap end of talk for 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 were bookrunners for the Rule 144A offering.

The notes are non-callable.

There is takeover and dividend protection above 19 cents a quarter.

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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