Summary
Dominion Energy, Inc. (D) has filed an 8-K report detailing the completion of an optional remarketing of $1.4 billion in subordinated notes originally issued in 2016. This transaction involved two tranches: $700 million of Series A-1 notes due 2021 and $700 million of Series A-2 notes due 2024. The remarketing resulted in an adjustment of the interest rates on these notes, increasing the Series A-1 notes' rate from 2.0% to 2.715% and the Series A-2 notes' rate from 2.0% to 3.071% per annum. Notably, Dominion Energy did not receive any proceeds from this remarketing. Instead, the proceeds were used to acquire a portfolio of treasury securities maturing on August 15, 2019. The company anticipates using funds from this portfolio's maturity to settle purchase contracts associated with the original 2016 Corporate Units. This action signals a step towards settling obligations related to the 2016 issuance, without impacting current cash flow from the remarketing itself.
Key Highlights
- 1Completed optional remarketing of $700 million Series A-1 notes (due 2021) and $700 million Series A-2 notes (due 2024).
- 2Interest rate on Series A-1 notes reset from 2.0% to 2.715% per annum.
- 3Interest rate on Series A-2 notes reset from 2.0% to 3.071% per annum.
- 4Dominion Energy received no proceeds from the remarketing transaction.
- 5Proceeds from the remarketing were used to purchase a portfolio of treasury securities maturing on August 15, 2019.
- 6The company expects to use maturing treasury securities to settle purchase contracts related to the 2016 Corporate Units.