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HOUSTON - CenterPoint Energy, Inc. (NYSE:CNP), a $24.38 billion market cap utility company, announced on Monday the pricing of $900 million in convertible senior notes due 2028 in a private placement to qualified institutional buyers under Rule 144A of the Securities Act. According to InvestingPro data, the company has demonstrated strong returns over the past five years while maintaining relatively low price volatility.
The notes will carry a 3.00% interest rate, payable semiannually beginning February 1, 2026, and will mature on August 1, 2028. CenterPoint has granted initial purchasers an option to buy up to an additional $100 million in notes. This debt offering comes as InvestingPro analysis shows the company operating with a significant debt burden, with total debt standing at $21.62 billion and a current ratio of 0.79.
The convertible notes will be senior, unsecured obligations with an initial conversion rate of 21.4477 shares of common stock per $1,000 principal amount, equivalent to a conversion price of approximately $46.63 per share. Prior to May 1, 2028, the notes will be convertible only upon specific events and during certain periods.
Upon conversion, CenterPoint will pay cash up to the aggregate principal amount and may deliver cash, shares, or a combination for any remainder of the conversion obligation exceeding the principal amount.
The company expects to receive approximately $888.1 million in net proceeds from the offering, or $986.8 million if the additional purchase option is exercised in full. CenterPoint plans to use the proceeds for general corporate purposes, including repayment of outstanding commercial paper and other debt.
The transaction is expected to close on July 31, 2025. The notes and any shares issuable upon conversion have not been registered under the Securities Act and are being offered only to qualified institutional buyers.
CenterPoint Energy is an energy delivery company with electric and gas utility operations serving more than 7 million customers across Indiana, Minnesota, Ohio and Texas, according to the company’s press release statement. The company has maintained dividend payments for 55 consecutive years, demonstrating strong financial stability. For deeper insights into CenterPoint’s financial health and future prospects, investors can access the comprehensive Pro Research Report available on InvestingPro, which covers over 1,400 top US stocks.
In other recent news, CenterPoint Energy announced its Q2 2025 earnings, which fell short of analysts’ expectations. The company reported an earnings per share (EPS) of $0.29, missing the projected $0.34 by 14.71%. Revenue also came in below forecasts at $1.94 billion, compared to the anticipated $2.02 billion, representing a 3.96% shortfall. Additionally, CenterPoint Energy revealed plans to offer $900 million in Convertible Senior Notes due 2028. This offering will be conducted through a private placement to qualified institutional buyers. The company also plans to grant initial purchasers an option to buy up to an additional $100 million in convertible notes. These recent developments highlight significant financial activities for CenterPoint Energy.
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