The Tennessee Valley Authority priced $1.25 billion of new 30-year maturity global power bonds on Wednesday, with an interest rate of 5.25%. The offering represents TVA’s first offering of senior unsecured 30-year bonds since September 2022, and the largest offering of new bonds since 2011. Proceeds of the offering will be used to support TVA’s capital investments and help refinance maturing debt.
“TVA works every day to provide energy security – reliable, affordable, resilient, and sustainable American-made energy for the 10 million people and communities we serve,” said Tom Rice, TVA chief financial officer. “TVA has one of the nation’s largest, most balanced generation portfolios, and today’s offering provides funding for our expanded system investments, which will continue to support our growing region.”
Barclays, BofA Securities, JP Morgan, and Morgan Stanley, served as joint book-running managers for the transaction, which attracted interest from a wide variety of domestic and global institutions, including official institutions, governments, pension funds, money managers and insurance companies.
“We were pleased to see the strong market reception for today’s offering,” said Mr. Rice. “The 30-year tenor fits well in TVA’s maturities profile, and the new bonds will help TVA’s capital needs which will ensure we continue to deliver on our mission.”
The new bonds will mature on Feb. 1, 2055, and are not subject to redemption prior to maturity. Interest will be paid semi-annually each Feb. 1 and Aug. 1. Application has been made to list the bonds on the New York Stock Exchange.
The bonds will be issued, maintained, and transferred through the book-entry system of the Federal Reserve Banks. Transactions may be cleared and settled by international participants through Clearstream and Euroclear. The bonds can be identified by the CUSIP number 880591FC1 (ISIN number US880591FC19).
The Tennessee Valley Authority is the nation’s largest public power supplier, delivering energy to more than 10 million people across seven southeastern states. TVA has one of the most diverse energy systems – including nuclear, hydro, solar, gas, and advanced technologies. To prepare for the future, TVA is making significant investments in its power system toward new generation and transmission.