Moncks Corner-based Santee Cooper will hold what could be the second-largest bond sale in the electric utility’s history next week when it issues between $700 million and $1.2 billion worth of revenue bonds to refinance debt and help pay the utility’s share of new nuclear power units being built at the V.C. Summer Nuclear Station in Jenkinsville.
The final size of the bond deal will depend on interest rate movement by the time the bonds are priced on Tuesday and Wednesday, with a more favorable interest rate leading to a larger sale.
The utility’s largest bond issue was in 2013, when a $1.8 billion package was approved for capital expenses and debt refinancing. Next week’s sale would trail only that issue if the maximum $1.2 billion is reached.
Next week’s sale also will give private individuals an opportunity to purchase the revenue bonds, which are usually only sold to institutional investors. Individual investors can purchase up to $1 billion worth of the bonds on Tuesday, with remaining bonds to be sold to organizations such as mutual funds and pension funds.
The bonds will be sold in four issuances and most will be tax-exempt except for one issue totaling $170 million.
The bond issue will need approval by Santee Cooper’s board of directors before it is final, and the board is expected to meet by the end of next week to ratify the sale.
The issue drew a rating of A1 from Moody’s, which also issued Santee Cooper a stable outlook and reaffirmed its long-term debt ratings. Ratings from other agencies are expected later this week, according to a news release.
Investors interested in participating in the retail issue can contact Santee Cooper’s bondholder relations office at 1-877-246-3338 for more information. Senior manager on the issue will be Barclays, with Bank of America Merrill Lynch serving as co-senior manager. Co-managers are Goldman Sachs & Co., Morgan Stanley, J.P. Morgan, US Bancorp and Wells Fargo Securities.
Santee Cooper is South Carolina’s largest power producer, providing electricity to 40 percent of the state’s population, or about 2 million people. The utility has 45 percent ownership of the V.C. Summer nuclear plant in a partnership with S.C. Electric & Gas.
Reach David Wren at 937-5550 or on Twitter at @David_Wren_