NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION
IN THE UNITED STATES
HALIFAX, Nova Scotia--(BUSINESS WIRE)--
Emera Incorporated announces offering of US$1.2 billion 6.75%
Fixed-to-Floating Subordinated Notes, Cdn$500 million 2.90% Senior Notes
and US$3.25 billion aggregate principal amount of multiple series of
Senior Notes as part of the funding for the acquisition of TECO Energy,
Inc.
Emera Incorporated (“Emera” or the “Company”) (TSX:EMA) announced today
that it has agreed to issue and sell US$1,200,000,000 aggregate
principal amount of 6.75% Fixed-to-Floating Subordinated Notes – Series
2016-A due June 2076 (the “Hybrid Notes”), subject to the terms and
conditions of an underwriting agreement and pursuant to a final
prospectus supplement (the “Prospectus Supplement”) to a short form base
shelf prospectus dated June 8, 2016 (the “Base Shelf Prospectus”). J.P.
Morgan Securities LLC is acting as sole book runner and structuring
agent in connection with the Hybrid Notes offering and Barclays Capital
Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Scotia Capital
(USA) Inc. and Wells Fargo Securities, LLC are acting as co-managing
underwriters.
In addition, Emera announced today that it has agreed to issue and sell
Cdn$500,000,000 aggregate principal amount of 2.90% Senior Notes Series
2016-1 due June 16, 2023 (the “Canadian Notes”) on a private placement
basis, subject to the terms and conditions of an agency agreement and
pursuant to a final offering memorandum. Scotia Capital Inc. and J.P.
Morgan Securities Canada Inc. are acting as joint book running managers
in connection with the Canadian Notes offering and CIBC World Markets
Inc., RBC Dominion Securities Inc., TD Securities Inc., BMO Nesbitt
Burns Inc. and National Bank Financial Inc. are acting as co-managing
agents.
Emera also announced today that Emera US Finance LP (the “U.S. Notes
Issuer”), a limited partnership wholly-owned directly and indirectly by
Emera, has agreed to sell US$3,250,000,000 aggregate principal amount of
multiple series of senior, unsecured notes (the “U.S. Notes”), fully and
unconditionally guaranteed by Emera US Holdings Inc., a wholly-owned
subsidiary of Emera (“EUSHI”) and Emera (together with EUSHI, the
“Guarantors”), subject to the terms and conditions of a purchase
agreement and pursuant to a final offering memorandum. J.P Morgan
Securities LLC and Scotia Capital (USA) Inc. are acting as joint book
running managers in connection with the U.S. Notes offering. Barclays
Capital Inc., BMO Capital Markets Corp., CIBC World Markets Corp.Merrill Lynch, Pierce, Fenner & Smith Incorporated, RBC Capital Markets,
LLC, TD Securities (USA) LLC and Wells Fargo Securities, LLC are acting
as co-managers.
Emera is undertaking the offerings of the Hybrid Notes, Canadian Notes
and U.S. Notes, which together amount to gross proceeds of approximatelyCdn$6.2 billion, as part of the financing of the previously
announced acquisition of TECO Energy, Inc. (“TECO Energy”) by Emera (the
“Acquisition”).
Hybrid Notes Offering
Emera will pay interest on the Hybrid Notes at a rate of 6.75% per year
in equal semi-annual installments on June 15 and December 15 of each
year until June 15, 2026. Starting on June 15, 2026, Emera will pay
interest on the Hybrid Notes on every March 15, June 15, September 15
and December 15 of each year during which the Hybrid Notes are
outstanding thereafter until June 15, 2076.
From the closing of the offering of the Hybrid Notes to, but excluding,
June 15, 2026, the interest rate on the Hybrid Notes will be fixed at
6.75% per annum, payable in arrears. Starting on June 15, 2026, and on
every March 15, June 15, September 15 and December 15 of each year
during which the Hybrid Notes are outstanding thereafter until June 15,
2076 (each such date, an “Interest Reset Date”), the interest rate on
the Hybrid Notes will be reset as follows: (i) starting on June 15,
2026, on every Interest Reset Date until June 15, 2046, the interest
rate on the Hybrid Notes will be reset at an interest rate per annum
equal to the three month LIBOR plus 5.44%, payable in arrears, with the
first payment at such rate being on September 15, 2026; and (ii)
starting on June 15, 2046, on every Interest Reset Date, until June 15,
2076, the interest rate on the Hybrid Notes will be reset on each
Interest Reset Date at an interest rate per annum equal to the three
month LIBOR plus 6.19%, payable in arrears, with the first payment at
such rate being on September 15, 2046.
Closing of the offering of the Hybrid Notes is expected to occur on or
about June 16, 2016.
The Hybrid Notes will not be listed on any securities exchange and Emera
does not intend to arrange for the Hybrid Notes to be included on any
automated quotation system. The Hybrid Notes are not being offered for
sale in Canada and this press release is not an offer of securities for
sale in the United Sates. The offering of the Hybrid Notes for sale in
the United States is being made pursuant to an effective shelf
registration statement of Emera previously filed with the United States
Securities and Exchange Commission. The Prospectus Supplement and the
accompanying Base Shelf Prospectus may be obtained from Emera and will
contain detailed information about the Company and management, as well
as financial statements.
Canadian Notes Offering
Emera will pay interest on the Canadian Notes semi-annually in arrears
in equal instalments on June 16 and December 16 of each year, commencing
on December 16, 2016, and on the maturity date of the Canadian Notes.
Closing of the offering of the Canadian Notes is expected to occur on or
about June 16, 2016.
The Canadian Notes are being offered in reliance upon exemptions from
prospectus requirements available under applicable Canadian securities
laws.As a consequence, the resale of the Canadian Notes will be
restricted in the manner provided by Canadian securities laws. The
offering of the Canadian Notes will not be registered under the United
States Securities Act of 1933, as amended (the “Securities Act”) or any
state securities laws. The Canadian Notes are not being offered for sale
in the United States and this press release is not an offer of
securities for sale in the United States.
The Canadian Notes will not be listed on any securities exchange and
Emera does not intend to arrange for the Canadian Notes to be included
on any automated quotation system.
U.S. Notes Offering
The U.S. Notes Issuer has agreed to issue US$500million
aggregate principal amount of 2.15% Senior Notes due 2019 (the “2019
Notes”), US$750 million aggregate principal amount of 2.70% Senior Notes
due 2021 (the “2021 Notes”), US$750 million aggregate principal amount
of 3.55% Senior Notes due 2026 (the “2026 Notes”) and US$1.25 billion
aggregate principal amount of 4.75% Senior Notes due 2046 (the “2046
Notes”, and together with the 2019 Notes, the 2021 Notes and the 2026
Notes, the “notes”). The U.S. Notes Issuer will pay interest on the
notes of each series semi-annually in arrears on June 15 and December 15
of each year, commencing on December 15, 2016, and on the maturity date
for each series of notes.
Closing of the offering of the U.S. Notes is expected to occur on or
about June 16, 2016.
The offering of the U.S. Notes and the related guarantees has not been
registered under the Securities Act or any state securities laws and the
U.S. Notes and the related guarantees may not be offered or sold in the
United States absent a registration under the Securities Act or an
applicable exemption from registration requirements. The U.S. Notes are
being sold only to “qualified institutional buyers” under Rule 144A of
the Securities Act and to non-U.S. persons under Regulation S of the
Securities Act. The U.S. Notes are not being offered for sale in Canada
and this press release is not an offer of securities for sale in the
United States. Until such time as the U.S. Notes are registered pursuant
to the terms of the registration rights agreement, they will be subject
to certain restrictions on resale.
The U.S. Notes will not be listed on any securities exchange, and the
U.S. Notes Issuer and the Guarantors do not intend to arrange for the
U.S. Notes to be included on any quotation system.
Use of Proceeds
Upon the closing of the Acquisition, Emera intends to use the net
proceeds from the offering of the Hybrid Notes, Canadian Notes and U.S.
Notes to finance, directly or indirectly, part of the purchase price
payable for the Acquisition (including acquisition-related expenses) and
to reduce amounts outstanding under the credit facilities established in
favour of Emera to fund the purchase price payable for the Acquisition,
to the extent any amounts are drawn on such facilities in connection
with the Acquisition. If certain of the net proceeds from the offering
of the Hybrid Notes, Canadian Notes and/or U.S. Notes are not otherwise
required to complete the Acquisition, Emera intends to use such net
proceeds for general corporate purposes.
If (i) the Acquisition is not consummated on or prior to the later of
December 31, 2016 and the date that is no later than June 30, 2017 if
the closing of the Acquisition has been extended by Emera or TECO Energy
in accordance with the terms of the agreement and plan of merger
relating to the Acquisition (the “Acquisition Agreement”) (as such date
may be extended, the “special mandatory redemption triggering date”) or
(ii) the Acquisition Agreement is terminated at any time prior to the
special mandatory redemption triggering date, then Emera will be
required to redeem the Hybrid Notes and the portion of the Canadian
Notes that is in excess of $300 million aggregate principal amount on a
pro rata basis, and the U.S. Notes Issuer will be required to redeem any
U.S. Notes.
Forward Looking Information
This news release contains forward-looking information within the
meaning of applicable securities laws with respect to, among other
things, the Acquisition and the intended use of the net proceeds from
the sale of the Hybrid Notes, the Canadian Notes and U.S. Notes. By its
nature, forward-looking information requires Emera to make assumptions
and is subject to inherent risks and uncertainties. These statements
reflect the current beliefs of the management teams of Emera and are
based on information currently available to Emera. There is a risk that
predictions, forecasts, conclusions and projections that constitute
forward-looking information will not prove to be accurate, that the
assumptions of Emera may not be correct and that actual results may
differ materially from such forward-looking information. Additional
detailed information about these assumptions, risks and uncertainties
with respect to Emera is included in Emera's securities regulatory
filings, including under the heading "Business Risks and Risk
Management" in Emera's annual Management's Discussion and Analysis, and
under the heading "Principal Risks and Uncertainties" in the notes to
Emera's annual and interim financial statements. The securities
regulatory filings of Emera can be found on SEDAR at www.sedar.com.
Except as required by law, Emera disclaims any intention or obligation
to update or revise any forward-looking statements, whether as a result
of new information, future events or otherwise.
About Emera
Emera is a geographically diverse energy and services company
headquartered in Halifax, Nova Scotia with approximately CAD$11.5
billion in assets and 2015 revenues of CAD$2.79 billion. Emera invests
in electricity generation, transmission and distribution, as well as gas
transmission and utility energy services. Emera’s strategy is focused on
the transformation of the electricity industry to cleaner generation and
the delivery of that clean energy to market. Emera has investments
throughout northeastern North America and in four Caribbean countries.
Emera continues to target having 75-85% of its adjusted earnings come
from rate-regulated businesses. Emera’s common and preferred shares are
listed on the Toronto Stock Exchange and trade respectively under the
symbol EMA, EMA.PR.A, EMA.PR.B, EMA.PR.C, EMA.PR.E, and EMA.PR.F, and
instalment receipts are listed and trade under the symbol EMA.IR.
Depositary receipts representing common shares of Emera are listed on
the Barbados Stock Exchange under the symbol EMABDR. Additional
Information can be accessed at www.sedar.com.
View source version on businesswire.com: http://www.businesswire.com/news/home/20160610005273/en/
Emera Incorporated
Investor Relations:
Scott LaFleur,
902-428-6375
Scott.lafleur@emera.com
or
Media:
Neera
Ritcey, 902-223-2272
neera.ritcey@emera.com
Source: Emera Incorporated