Summary
Sempra (SRE) announced the successful closing of a public offering of $1 billion in aggregate principal amount of junior subordinated notes. This offering was split into two tranches: $400 million of 6.625% Fixed-to-Fixed Reset Rate Junior Subordinated Notes due 2055 (Non-Call 5) and $600 million of 6.550% Fixed-to-Fixed Reset Rate Junior Subordinated Notes due 2055 (Non-Call 10). The net proceeds from this offering, estimated at approximately $990 million after deducting underwriting discounts but before other expenses, will be utilized by the company. The notes feature reset rate provisions after their respective initial call protection periods, offering investors exposure to future interest rate environments. This issuance is a strategic move to bolster the company's capital structure.
Key Highlights
- 1Sempra closed a $1 billion offering of junior subordinated notes on November 18, 2024.
- 2The offering comprised $400 million of 6.625% notes due 2055 (Non-Call 5) and $600 million of 6.550% notes due 2055 (Non-Call 10).
- 3Net proceeds from the offering are approximately $990 million.
- 4The notes have initial fixed interest rates of 6.625% and 6.550% respectively.
- 5Interest rates on both series of notes will reset after their respective initial non-call periods, based on the Five-year U.S. Treasury Rate plus a spread.
- 6Sempra has the option to defer interest payments under certain conditions.
- 7The company may redeem the notes under specific circumstances, including on or prior to their respective reset dates and on interest payment dates thereafter.