Summary
Southern Company (SO) announced on May 26, 2025, the issuance of $1.65 billion in aggregate principal amount of Series 2025A 3.25% Convertible Senior Notes due June 15, 2028. These notes are direct, unsecured, and unsubordinated obligations of the company. The issuance was conducted through a Purchase Agreement with initial purchasers and included an exercise of an over-allotment option for $200 million. Investors should note the key terms of these convertible notes, including their interest rate, maturity date, and conversion features. The notes are convertible under specific conditions related to the company's common stock price and the notes' trading price, or upon specified corporate events. The initial conversion rate is set at 8.8077 shares of common stock per $1,000 principal amount, implying an initial conversion price of approximately $113.54 per share. The company will settle conversions with a combination of cash and/or stock at its election. The issuance of these notes was made under exemptions from registration, relying on Section 4(a)(2) and Rule 144A for the initial sale, and expected to rely on Section 3(a)(9) for any shares issued upon conversion.
Key Highlights
- 1Southern Company issued $1.65 billion in Series 2025A 3.25% Convertible Senior Notes due June 15, 2028.
- 2The notes bear interest at a rate of 3.25% per annum, payable semiannually.
- 3The issuance included a $200 million over-allotment option exercised by the initial purchasers.
- 4The notes are direct, unsecured, and unsubordinated obligations of the company.
- 5Conversion is permitted under specific stock price performance and note trading price conditions, or upon certain corporate events.
- 6The initial conversion rate is 8.8077 shares of Common Stock per $1,000 principal amount, equating to an initial conversion price of approximately $113.54.
- 7The company may elect to settle conversions with cash, stock, or a combination thereof.