Southern Company Announces $1.75B Equity Units Offering, Including Forward Stock Purchase And Senior Notes

Southern Company (NYSE:SO) today announced it plans to sell 35 million equity units in a public offering. Each equity unit will be issued in a stated amount of $50 ($1.75 billion aggregate stated amount) and will consist of a contract to purchase Southern Company common stock in the future and two 1/40 undivided beneficial ownership interests in remarketable senior notes each having a principal amount of $1,000. Southern Company expects to grant to the underwriters an option to purchase an additional 5 million equity units ($250 million aggregate stated amount) solely for the purpose of covering over-allotments.

Southern Company intends to use a portion of the net proceeds from this offering to repurchase a portion of its Series 2023A 3.875% Convertible Senior Notes due December 15, 2025 (the "Series 2023A Convertible Notes") and its Series 2024A 4.50% Convertible Senior Notes due June 15, 2027 (together with the Series 2023A Convertible Notes, the "Existing Convertible Notes"), in each case through individually negotiated transactions with a limited number of holders thereof (each, a "note repurchase transaction"), effected through one of the underwriters for the equity units or its affiliate. Southern Company intends to use the remaining net proceeds from this offering (i) to repay all or a portion of Southern Company's short-term indebtedness, (ii) to repay at maturity all or a portion of the remaining outstanding Series 2023A Convertible Notes and (iii) to satisfy all or a portion of the redemption price in connection with the proposed redemption at par of the $1.25 billion aggregate principal amount of its Series 2020B 4.00% Fixed-to-Fixed Reset Rate Junior Subordinated Notes due January 15, 2051. Any remaining net proceeds will be used for general corporate purposes, including investments in Southern Company's subsidiaries.