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LONDON - British energy company SSE (LON:SSE) plc issued €1.3 billion in hybrid capital securities on Thursday, comprising two tranches of subordinated debt instruments to support its investment strategy.
The dual-tranche issuance consists of an €800 million perpetual non-call 5.25-year note with a 4.0% coupon and a €500 million perpetual non-call 8.0-year note with a 4.5% coupon, according to a company press release.
SSE plans to use the proceeds to replace a £600 million hybrid capital security issued in 2020, which has its first coupon reset date in April 2026. The new issuance will increase SSE’s total outstanding hybrids by approximately £500 million to £2.4 billion after the planned redemption.
The securities were reportedly four times oversubscribed, indicating strong investor interest. The first call dates for the €800 million and €500 million securities are from September 2030 and June 2033, respectively.
Barry O’Regan, SSE’s Chief Financial Officer, said the new hybrids would contribute toward funding the company’s portfolio of investment options as part of its £17.5 billion investment plan through March 2027.
The hybrid securities will be equity accounted with coupon payments made annually in arrears. First coupon payments will occur in the financial year ending March 31, 2027.
SSE, which operates in the clean energy sector, will present these payments as distributions to other equity holders and reflect them within adjusted earnings per share.
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