CenterPoint Energy, Inc. announces pricing of public offering of 9,754,194 shares of Common Stock

Rhea-AI Summary

CenterPoint Energy (NYSE: CNP) has priced a public offering of 9,754,194 shares of common stock at $25.63 per share, expecting to raise approximately $250 million in gross proceeds. The company plans to use the net proceeds for general corporate purposes, including repaying a portion of outstanding commercial paper. Barclays Capital Inc. and Citigroup are acting as joint book-running managers and underwriters for the offering. The offering is being made through CenterPoint Energy's effective shelf registration statement on Form S-3 filed with the SEC. Prospectus and related documents are available from the SEC's website and the underwriters.

Positive

• Expected to raise approximately $250 million in gross proceeds
• Funds to be used for general corporate purposes and debt repayment
• Offering made through an effective shelf registration statement

Negative

• Potential dilution of existing shareholders' ownership
• Increase in outstanding shares may impact earnings per share

Insights

Financial Analyst

CenterPoint Energy's $250 million common stock offering is a significant move that warrants investor attention. This equity raise will strengthen the company's balance sheet by reducing commercial paper debt, which is typically short-term. The 3.8% share dilution (based on 258 million shares outstanding) is relatively modest given the capital raised.

The pricing at $25.63 per share represents a slight discount to the current market price, which is common in such offerings to ensure full subscription. This move suggests management's focus on maintaining financial flexibility, potentially preparing for future investments or navigating uncertain market conditions. Investors should monitor how effectively the company deploys this capital and its impact on future earnings per share.

Utility Industry Expert

CenterPoint Energy's decision to raise equity capital is indicative of broader trends in the utility sector. With rising interest rates and increasing capital expenditure needs for grid modernization and clean energy transitions, many utilities are turning to equity markets to balance their capital structure.

This move may signal CenterPoint's intention to accelerate its infrastructure investments or prepare for potential regulatory changes. The use of proceeds to repay commercial paper suggests a prudent approach to managing short-term liabilities. Investors should consider how this capital raise aligns with CenterPoint's long-term strategy and its potential impact on the company's regulatory capital structure, which can affect allowed returns in rate cases.

HOUSTON--(BUSINESS WIRE)-- CenterPoint Energy, Inc. (NYSE: CNP) today announced the pricing of an underwritten public offering of 9,754,194 shares of its common stock, par value $0.01 per share, at a public offering price of $25.63 per share, for expected gross proceeds of approximately $250 million before deducting estimated offering expenses. CenterPoint Energy intends to use the net proceeds from the offering for general corporate purposes, including repayment of a portion of our outstanding commercial paper. Proceeds from our commercial paper were used for general corporate purposes, including working capital purposes.

Barclays Capital Inc. and Citigroup are acting as joint book-running managers and underwriters for the offering.

The offering is being made pursuant to CenterPoint Energy’s effective shelf registration statement on Form S-3 previously filed with the Securities and Exchange Commission (SEC). The offering will be made only by means of a prospectus and related prospectus supplement meeting the requirements of Section 10 of the Securities Act of 1933, as amended. Copies of the prospectus supplement and accompanying base prospectus meeting such requirements related to each offering may be obtained free of charge from the SEC's website, www.sec.gov or from:

Barclays Capital Inc.,
c/o Broadridge Financial Solutions
1155 Long Island Avenue
Edgewood, New York 11717
Barclaysprospectus@broadbridge.com
(888) 603-5847

Citigroup
c/o Broadridge Financial Solutions
1155 Long Island Avenue
Edgewood, New York 11717
(Tel: 800 831-9146)

CenterPoint Energy's common stock is listed on the New York Stock Exchange and the NYSE Chicago under the symbol CNP.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any shares of common stock or any other securities, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

This press release includes forward-looking statements. Actual events and results may differ materially from those projected. The statements in this press release regarding the size and terms of the offering, the use of proceeds from the offering, and other statements that are not historical facts, are forward-looking statements. Factors that could affect actual results include, but are not limited to, factors, risk and uncertainties discussed in CenterPoint Energy, Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and CenterPoint’s Quarterly Reports on Form 10-Q for the quarters ended March 31, 2024 and June 30, 2024 and other reports CenterPoint Energy may file from time to time with the Securities and Exchange Commission.

As the only investor-owned electric and natural gas utility based in Texas, CenterPoint Energy, Inc. (NYSE: CNP) is an energy delivery company with electric transmission and distribution, power generation and natural gas distribution operations that serve more than 7 million metered customers in Indiana, Louisiana, Minnesota, Mississippi, Ohio, and Texas. As of June 30, 2024, the company owned approximately $41 billion in assets. With approximately 9,000 employees, CenterPoint Energy and its predecessor companies have been in business for more than 150 years.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240807437731/en/

Media:

Communications

media.relations@centerpointenergy.com

Investors:

Jackie Richert / Ben Vallejo

713.207.6500

Source: CenterPoint Energy, Inc.

FAQ

What is the price per share for CenterPoint Energy's (CNP) public offering?

CenterPoint Energy (CNP) has priced its public offering at $25.63 per share.

How many shares is CenterPoint Energy (CNP) offering in its public offering?

CenterPoint Energy (CNP) is offering 9,754,194 shares of its common stock in the public offering.

What are the expected gross proceeds from CenterPoint Energy's (CNP) public offering?

CenterPoint Energy (CNP) expects to raise approximately $250 million in gross proceeds from the public offering.

How does CenterPoint Energy (CNP) plan to use the proceeds from its public offering?

CenterPoint Energy (CNP) intends to use the net proceeds for general corporate purposes, including repayment of a portion of its outstanding commercial paper.