Southern Company plans $2.15 billion in convertible notes offerings

Southern Company (NYSE: SO) announced private placement offerings of $650 million in convertible senior notes due December 15, 2027, and $1.5 billion in convertible senior notes due September 15, 2029, according to a company statement.

The notes will be offered to qualified institutional buyers under Rule 144A of the Securities Act of 1933. Southern Company also expects to grant initial purchasers options to buy up to an additional $97.5 million of the 2027 notes and up to $225 million of the 2029 notes, exercisable within 13 days of issuance.

Both series will be senior, unsecured obligations with semiannual interest payments. Final terms, including interest rates and initial conversion prices, will be set at pricing. Upon conversion, Southern Company will pay cash up to the principal amount and may settle any excess in cash, common stock, or a combination at its discretion.

Southern Company intends to use a portion of the proceeds to repurchase some of its existing Series 2024A 4.50% Convertible Senior Notes due June 15, 2027, and its Series 2025A 3.25% Convertible Senior Notes due June 15, 2028, through individually negotiated transactions. Remaining proceeds are intended for repayment of short-term debt and general corporate purposes, which may include investment in subsidiaries.

The notes have not been registered under the Securities Act and may not be offered or sold without registration or an applicable exemption.

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