On 8 June 2023, EDF (BBB stable S&P / Baa1 stable Moody’s / BBB+ stable Fitch) successfully priced a US dollar-denominated 1.5 billion issuance of perpetual subordinated notes, at an initial 9.125% coupon until 2033 with a 10-year first call date at EDF’s discretion (the “New Notes”).
EDF will be able to redeem the New Notes for cash (i) at any time during the 3-month period preceding the first interest reset date, which is expected to be in 10 years, and on every 5 years thereafter, (ii) for rating methodology or accounting events, or certain changes of tax regime, or (iii) at any time pursuant to the make-whole call [2].
EDF confirms that hybrid securities are a permanent part of its capital structure. This transaction is part of EDF's pro-active management of its outstanding hybrid notes: the proceeds resulting from this offering will be allocated for the redemption, in whole or in part, of its US dollar-denominated perpetual subordinated notes (144A / Reg. S ISIN: US268317AM62 / USF2893TAM83)(1) and for general corporate purposes of the Group.
Settlement and delivery of the New Notes will take place on 15 June 2023, the date on which they will be admitted to trading on the multilateral trading facility operated by the Luxembourg Stock Exchange (Euro MTF). It is also expected that the rating agencies will assign the New Notes a rating of B+/Ba1/ /BBB- (S&P/ Moody’s/Fitch) and an equity content of 50%.
[2] The make-whole call enables the early redemption by EDF of the outstanding New Notes, in whole, at a price which depends on the make-whole redemption date.