What is the primary purpose of this $600 million equity unit sale?

The primary purpose is to raise capital for NextEra Energy, Inc. through a structured financial product that combines a future commitment to purchase common stock with an initial investment in a related debenture.

How does an investor acquire NEE common stock through these equity units?

Investors acquire equity units that contain a stock purchase contract. By June 1, 2015, the holder must fulfill this contract by purchasing NEE common stock for cash, with the price determined within a specified range. The debenture component can potentially be remarketed to fund this purchase obligation.

What is the role of the Series E Debenture?

The Series E Debenture, issued by NextEra Energy Capital Holdings, Inc., is initially a component of the equity unit, providing the investor with a 5% beneficial ownership interest. This debenture matures on June 1, 2017, and its remarketing can be used by the equity unit holder to satisfy their obligation to purchase NEE common stock.

What is the yield on these equity units?

The equity units are expected to provide total annual distributions at a rate of 5.599% per year, which is comprised of interest payments on the debentures and payments under the stock purchase contracts.

NEXTERA ENERGY INC 8-K SEC Disclosure

Summary

NextEra Energy, Inc. (NEE) announced on May 4, 2012, a significant financing event involving the sale of $600 million of equity units. These units are structured to allow investors to purchase NEE common stock in the future while initially providing a beneficial interest in Series E Debentures issued by its subsidiary, NextEra Energy Capital Holdings, Inc. (NEECH). This transaction represents an effort by NEE to raise capital through a complex financial instrument, with the underlying debentures guaranteed by the parent company.

Key Highlights

1NextEra Energy (NEE) raised $600 million through the sale of equity units.
2Each equity unit consists of a stock purchase contract and an interest in a Series E Debenture due June 1, 2017.
3The stock purchase contract obligates the holder to buy NEE common stock at a future date.
4The purchase price for NEE common stock will be within a range of $64.35 to $77.22 per share.
5The equity units will yield annual distributions at a rate of 5.599%.
6The debentures, a component of the equity units, are guaranteed by NextEra Energy, Inc. (NEE).
7The transaction was registered under the Securities Act of 1933.

NEXTERA ENERGY INC 8-K Report, Corporate Update (May 4, 2012)

Summary

Key Highlights

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