TVA Prices $500 Million, 30-Year Global Power Bonds
June 2 , 2005
Lowest Coupon Rate Ever on U.S. Corporate, Agency 30-Year Bond
TVA announced today that it has priced $500 million of 30-year global power bonds. The bonds carry a coupon rate of 4.65 percent, which records indicate is the lowest rate ever achieved on a 30-year U.S. corporate or U.S. agency transaction.
“TVA was able to respond quickly to favorable market conditions,” said TVA Chief Financial Officer Michael Rescoe. “Only on three other days over the past 25 years has the long-dated U.S. Treasury bond closed below its current level. We are pleased that this financing will reduce TVA’s interest expense while meeting the needs of our diversified investor base.”
The bonds will pay interest semi-annually on Dec. 15 and June 15 and will mature on June 15, 2035.
Proceeds from the sale will be used to refinance existing debt. TVA expects the bonds to be rated “AAA” by Standard and Poor’s and “Aaa” by Moody’s Investors Service. Banc of America Securities, LLC and Morgan Stanley are joint lead managers for the sale.
TVA is making application 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 in the bonds may be cleared and settled by international participants through Euroclear and Clearstream.
TVA is a wholly owned federal corporation and the nation’s largest public power provider. It is completely self-financed through power revenues and proceeds from power program financings. TVA provides power to large industries and 158 power distributors that serve approximately 8.5 million consumers in seven southeastern states.
Media Contact
TVA News Bureau, Knoxville, (865) 632-6000
TVA Investor Relations (toll-free), Knoxville, (888) 882-4975
TVA Investor Relations (toll-free International), (888) 882-4976
On the web, www.tva.com/finance
