South Jersey Industries (SJI) announces common stock and equity units offerings
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South Jersey Industries, Inc. (NYSE: SJI) (the “Company”) today announced that it plans to conduct concurrent registered public offerings, subject to market conditions and other factors, of up to $225 million of shares of its common stock (the “Common Stock”), a portion of which may be subject to the forward sale agreement described below, and 6,000,000 Equity Units (the “Equity Units”) (aggregate stated amount of $300 million of Equity Units).
In connection with the offering of shares of Common Stock, the Company expects to enter into a forward sale agreement with an affiliate of BofA Securities (such affiliate, the “Forward Purchaser”), under which the Company will agree to sell to the Forward Purchaser the same number of shares of Common Stock as are sold by an affiliate of the Forward Purchaser to the underwriters for sale in the underwritten public offering (subject to certain adjustments and to the Company’s right, in certain circumstances, to elect cash settlement or net share settlement of the forward sale agreement). Subject to certain conditions, an affiliate of the Forward Purchaser is expected to borrow, and sell to the underwriters, the number of shares of Common Stock subject to the forward sale agreement at the close of the Common Stock offering in connection with the forward sale agreement.
Settlement of the forward sale agreement will occur on one or more dates no later than approximately 12 months after the date of the prospectus supplement relating to the Common Stock offering. Upon any physical settlement of the forward sale agreement, the Company will issue and deliver to the Forward Purchaser shares of Common Stock in exchange for cash proceeds per share of Common Stock equal to the forward sale price, which will initially be the price at which the underwriters agree to buy the Common Stock in the Common Stock offering, and will be subject to certain adjustments as provided in the forward sale agreement. The Company may, in certain circumstances, elect cash or net share settlement for all or a portion of its obligations under the forward sale agreement.
Net proceeds from these offerings will be used for the repayment of indebtedness, capital expenditures primarily for regulated businesses, including infrastructure investments at our utility business, and general corporate purposes. The Company will not receive any proceeds from the sale of the Common Stock sold by the Forward Purchaser (or its affiliate) to the underwriters. The Company intends to use any net proceeds that it receives upon settlement of the forward sale agreement as described above.
The Company intends to grant the underwriters a 30-day option to purchase up to an additional $33.75 million of shares of Common Stock and an option to purchase, within a 13-day period beginning on, and including, the date on which the Equity Units are first issued, up to an additional 900,000 Equity Units, upon the same terms as their respective offerings.
Each Equity Unit will be issued in a stated amount of $50 and will initially consist of a contract to purchase shares of Common Stock and a 1/20, or 5%, undivided beneficial ownership interest in $1,000 principal amount of the Company’s 2021 Series B remarketable junior subordinated notes due 2029. Pursuant to the purchase contracts, holders are required to purchase Common Stock no later than April 1, 2024. The Company intends to list Equity Units in the form of Corporate Units on the New York Stock Exchange, and expects trading to commence within 30 days of the date of initial issuance (subject to listing approval).
BofA Securities is acting as lead book-running manager for the Common Stock offering and sole book-running manager for the Equity Units offering and as the representative of the underwriters for both offerings.
Both offerings are being made pursuant to an effective shelf registration statement that has been filed with the Securities and Exchange Commission (the “SEC”). A preliminary prospectus supplement related to the offering of the Common Stock and a preliminary prospectus supplement related to the offering of the Equity Units will be filed with the SEC and will be available on the SEC’s website at http://www.sec.gov. Copies of the preliminary prospectus supplements and the accompanying prospectus relating to the Common Stock and Equity Units offerings may be obtained from BofA Securities at NC1-004-03-43, 200 North College Street, 3rd floor, Charlotte, NC 28255-0001, Attention: Prospectus Department or by emailing to email@example.com.
The Common Stock offering is not contingent on the Equity Units offering, and the Equity Units offering is not contingent on the Common Stock offering. This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities in any state or jurisdiction in which it is unlawful to make an offer, solicitation or sale.
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