DETROIT, Oct. 29, 2019 /PRNewswire/ -- DTE Energy (NYSE: DTE) today announced that it has priced its previously announced offerings of 2.4 million shares of its common stock at $126.00 per share and 23 million equity units. Each equity unit will be issued in a stated amount of $50 ($1.150 billion aggregate stated amount) and will consist of a contract to purchase DTE Energy common stock in the future and a 1/20, or 5%, undivided beneficial ownership interest in DTE's 2019 Series F 2.25% remarketable senior notes due 2025 having a principal amount of $1,000. The remarketable senior notes are subject to remarketing to commence no earlier than July 28, 2022. The offerings are expected to close on or about November 1, 2019, subject to customary closing conditions.
Total annual distribution on the equity units will be at the rate of 6.25%, consisting of interest on the 2019 Series F remarketable senior notes and payments under the related stock purchase contracts. The reference price for the equity units is $126.00 per share. The threshold appreciation price for the equity units is $157.50 per share, which represents a premium of approximately 25% over the reference price. Under the purchase contracts, holders will be required to purchase a variable number of shares of DTE Energy common stock no later than November 1, 2022.
DTE has granted the underwriters an option to purchase during the 30-day period beginning on the date hereof up to 360,000 additional shares of DTE Energy common stock,. DTE has granted the underwriters an option to purchase during the 13-day period beginning on the initial issuance date of the equity units up to 3 million additional equity units to cover over allotments.
DTE intends to use the net proceeds from these offerings, which are expected to be $295 million from the offering of its common stock or $339 million in the aggregate if the underwriters' option is exercised in full and $1.121 billion from the offering of equity units or $1.268 billion in the aggregate if the underwriters' over allotment option is exercised in full (in each case, after deducting underwriting discounts and commissions but before deducting other offering expenses), for the acquisition of midstream natural gas assets.
Barclays, BofA Securities, J.P. Morgan, Wells Fargo Securities, Citigroup and Scotia Howard Weil are acting as joint book-running managers for the offerings.
The offerings will be made under an effective shelf registration statement, filed with the U.S. Securities and Exchange Commission ("SEC"). This news release does not constitute an offer to sell or a solicitation of an offer to buy the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities law of any such jurisdiction. Any offers of securities will be made exclusively by means of a prospectus supplement relating to such securities and accompanying prospectus. Copies of these documents may be obtained by contacting Barclays Capital Inc., c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, at (888) 603-5847 or [email protected]; BofA Securities, Inc., Attention: Prospectus Department, 200 North College Street, NC1-004-03-43, Charlotte, NC 28255-0001, at (800) 294-1322, [email protected]; J.P. Morgan Securities LLC, c/o Broadridge Financial Solutions, 1155 Long Island Avenue Edgewood, NY 11717, at (866) 803-9204; Wells Fargo Securities, LLC, Attention: Equity Syndicate Department, 375 Park Avenue, 4th Floor, New York, NY 10152, at (800) 326-5897; Citigroup, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, at (800) 831-9146; and Scotia Capital (USA) Inc., 250 Vesey Street, 24th Floor, New York, NY 10281, Attention: Equity Capital Markets, at (212) 255-6854, [email protected].
About DTE Energy DTE Energy (NYSE: DTE) is a Detroit-based diversified energy company involved in the development and management of energy-related businesses and services nationwide. Its operating units include an electric company serving 2.2 million customers in Southeast Michigan and a natural gas company serving 1.3 million customers in Michigan. The DTE portfolio includes energy businesses focused on power and industrial projects; renewable natural gas; natural gas pipelines, gathering and storage; and energy marketing and trading.
The information contained herein is as of the date of this release. DTE Energy expressly disclaims any current intention to update any forward-looking statements contained in this release as a result of new information or future events or developments. Words such as "anticipate," "believe," "expect," "may," "could," "projected," "aspiration," "plans" and "goals" signify forward-looking statements. Forward-looking statements are not guarantees of future results and conditions but rather are subject to various assumptions, risks and uncertainties. This release contains forward-looking statements about DTE Energy's financial results and estimates of future prospects, and actual results may differ materially. Many factors impact forward-looking statements including, but not limited to, the following: impact of regulation by the EPA, the FERC, the MPSC, the NRC, and for DTE Energy, the CFTC, as well as other applicable governmental proceedings and regulations, including any associated impact on rate structures; the amount and timing of cost recovery allowed as a result of regulatory proceedings, related appeals, or new legislation, including legislative amendments and retail access programs; economic conditions and population changes in the our geographic area resulting in changes in demand, customer conservation, and thefts of electricity and, for DTE Energy, natural gas; the operational failure of electric or gas distribution systems or infrastructure; impact of volatility of prices in the oil and gas markets on DTE Energy's gas storage and pipelines operations; impact of volatility in prices in the international steel markets on DTE Energy's power and industrial projects operations; the risk of a major safety incident; environmental issues, laws, regulations, and the increasing costs of remediation and compliance, including actual and potential new federal and state requirements; the cost of protecting assets against, or damage due to, cyber incidents and terrorism; health, safety, financial, environmental, and regulatory risks associated with ownership and operation of nuclear facilities; volatility in the short-term natural gas storage markets impacting third-party storage revenues related to DTE Energy; volatility in commodity markets, deviations in weather, and related risks impacting the results of DTE Energy's energy trading operations; changes in the cost and availability of coal and other raw materials, purchased power, and natural gas; advances in technology that produce power, store power or reduce power consumption; changes in the financial condition of significant customers and strategic partners; the potential for losses on investments, including nuclear decommissioning and benefit plan assets and the related increases in future expense and contributions; access to capital markets and the results of other financing efforts which can be affected by credit agency ratings; instability in capital markets which could impact availability of short and long-term financing; the timing and extent of changes in interest rates; the level of borrowings; the potential for increased costs or delays in completion of significant capital projects; changes in, and application of, federal, state, and local tax laws and their interpretations, including the Internal Revenue Code, regulations, rulings, court proceedings, and audits; the effects of weather and other natural phenomena on operations and sales to customers, and purchases from suppliers; unplanned outages; employee relations and the impact of collective bargaining agreements; the availability, cost, coverage, and terms of insurance and stability of insurance providers; cost reduction efforts and the maximization of plant and distribution system performance; the effects of competition; changes in and application of accounting standards and financial reporting regulations; changes in federal or state laws and their interpretation with respect to regulation, energy policy, and other business issues; contract disputes, binding arbitration, litigation, and related appeals; and the risks discussed in DTE Energy's public filings with the SEC.