SCE&G prices, wraps any-and-all tender offers for three bond series

By Susanna Moon

Chicago, Feb. 26 – South Carolina Electric & Gas Co. announced the results of the cash tender offers for three series of its first mortgage bonds that ended at 5 p.m. ET on Feb. 25.

SCE&G was tendering for any and all of the three series of bonds and accepted for purchase all of the tendered bonds on Feb. 26, according to a company update on Tuesday.

Holders tendered the following amounts of notes with pricing set for each $1,000 principal amount:

• $297,127,000 of the $300 million 3.5% first mortgage bonds due 2021, with pricing set at $1,015.10 using the 2.5% U.S. Treasury security due Jan. 31, 2021 plus 35 basis points;

• $375,151,000 of the $425 million 4.1% first mortgage bonds due 2046, with pricing set at $1,011.36 using the 3.375% U.S. Treasury security due Nov. 15, 2048 plus 100 bps; and

• $323,295,000 of the $375 million 4.5% first mortgage bonds due 2064, with pricing set at $1,043.62 using the 3.375% U.S. Treasury security due Nov. 15, 2048 plus 125 bps.

Of the tendered amounts, the following remains subject to guaranteed delivery procedures: $100,000 of the 3.5% bonds, $75,000 of the 4.1% bonds and $447,000 of the 4.5% bonds.

Holders will also receive accrued interest up to but excluding the settlement date.

As announced Feb. 19, Scana Corp. and SCE&G are holding cash tender offers for several other series of notes.

Scana tender offer

Scana is tendering for up to $300 million of the following notes in an offer that will expire at 11:59 p.m. ET on March 18:

• $250 million of 6.25% medium-term notes due 2020, with pricing to be set using the 2.5% U.S. Treasury security due Jan. 31, 2021 plus 65 bps;

• $300 million of 4.75% medium-term notes due 2021, with pricing to be set using the 2.5% U.S. Treasury security due Jan. 31, 2021 plus 70 bps; and

• $250 million of 4.125% medium-term notes due 2022, with pricing to be set using the 2.5% U.S. Treasury security due Feb. 15, 2022 plus 85 bps.

Waterfall offer

SCE&G is tendering for an amount of the following bonds, which are listed in order of acceptance priority level, in a waterfall offer that will remain open until 11:59 p.m. ET on March 18:

• $500 million of 4.35% first mortgage bonds due 2042, with pricing to be set using the 3.375% U.S. Treasury security due Nov. 15, 2048 plus 100 bps;

• $400 million of 4.25% first mortgage bonds due 2028, with pricing to be set using the 2.625% U.S. Treasury security due Feb. 15, 2029 plus 65 bps;

• $400 million of 4.6% first mortgage bonds due 2043, with pricing to be set using the 3.375% U.S. Treasury security due Nov. 15, 2048 plus 105 bps;

• $100 million of 5.25% first mortgage bonds due 2035, with pricing to be set using the 3.375% U.S. Treasury security due Nov. 15, 2048 plus 135 bps;

• $150 million of 5.5% first mortgage bonds due 2039, with pricing to be set using the 3.375% U.S. Treasury security due Nov. 15, 2048 plus 135 bps;

• $200 million of 5.8% first mortgage bonds due 2033, with pricing to be set using the 2.625% U.S. Treasury security due Feb. 15, 2029 plus 125 bps;

• $300 million of 5.3% first mortgage bonds due 2033, with pricing to be set using the 2.625% U.S. Treasury security due Feb. 15, 2029 plus 110 bps;

• $350 million of 5.45% first mortgage bonds due 2041, with pricing to be set using the 3.375% U.S. Treasury security due Nov. 15, 2048 plus 110 bps; and

• $500 million of 5.1% first mortgage bonds due 2065, with pricing to be set using the 3.375% U.S. Treasury security due Nov. 15, 2048 plus 130 bps.

In the waterfall offer, the total purchase price will be $1.2 billion less the total purchase price payable for the bonds purchased by SCE&G in the any-and-all offer.

The total considerations for notes tendered in the Scana any-and-all offer and the SCE&G waterfall offer by the early deadline, 5 p.m. ET on March 4, will include a $30 early tender premium per $1,000 of notes.

RBC Capital Markets, LLC (877 381-2099 or 212 618-7843) and U.S. Bancorp Investments, Inc. (877 558-2607 or 612 336-7604) are acting as dealer managers for the offers. D.F. King & Co., Inc. (212 269-5550 for banks and brokers or 866 416-0576 for all others, or dei@dfking.com) is acting as the tender agent and information agent.

Scana and SCE&G are subsidiaries of Richmond, Va.-based Dominion Energy, Inc., a power and energy company.

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