NextEra Energy hit the corporate bond market on Thursday, raising $2.7 billion across four maturities to partly repay four separate loans signed on the last day of 2018 to fund its acquisition of Gulf Power Co.
Bank of America Merrill Lynch, Barclays, Credit Suisse and Goldman Sachs were the global coordinators on the four-tranche debt offering, which featured tenors ranging from three to 10 years.
The four global leads were joined as active bookrunners on the trade by BNP Paribas, Crédit Agricole, Mizuho and SMBC.
The senior unsecured offering hit investors’ screens in the morning with initial price thoughts of 85 to 90 basis points over Treasurys for the shortest, three-year tranche.
There was also a five-year pitched at 105 bp to 110 bp, a seven-year at 120 bp to 125 bp and a 10-year bond at 135 bp to 140 bp.
The total deal size was fixed at $2.7 billion from the outset, but the split between the individual tranches was determined later in the day after the bookrunners were able to gauge investor interest.
The three-year ended up being the largest, at $1 billion, and was priced 10 bp inside IPTs at 75 bp over Treasurys. The other three tranches were also priced well inside IPTs, with the five-year being sized at $900 million and priced at 95 bp, the seven-year at $300 million and 100 bp, and the 10-year at $500 million and 115 bp.
The loans NextEra intends to pay down with the proceeds are bilateral credit facilities, each $1.125 billion in size, provided by four different banks on Dec. 31.
The identities of the lenders were not disclosed in a U.S. Securities and Exchange Commission filing revealing the existence of the loans on Jan. 2.
With the $4.5 billion proceeds of the loan, NextEra closed its $5.75 billion acquisition of Florida utility Gulf Power from Southern Co. on the first day of 2019. The acquisition had been pending since an agreement was signed in May 2018 (PFR, 5/24/18).