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Duke Energy Indiana sells $500M in 1st mortgage bonds

Duke Energy Indiana LLC on Sept. 25 sold $500 million of its 3.25% first mortgage series YYY bonds due Oct. 1, 2049.

Interest is payable semiannually on April 1 and Oct. 1, starting April 1, 2020, Duke Energy Indiana said in a Sept. 25 free writing prospectus. The bonds have a spread to benchmark Treasury of 120 basis points. The issue was rated Aa3 by Moody's and A by S&P Global Ratings.

Duke Energy Indiana said it will use net proceeds to redeem at par three series of tax-exempt bonds, pay down intercompany short-term debt under its money-pool borrowing arrangement with parent Duke Energy Corp. and for general company purposes.

As of Sept. 13, the company had about $54 million of outstanding short-term money-pool borrowings.

Bank of America Merrill Lynch, Mizuho Securities USA LLC, Morgan Stanley & Co. LLC, MUFG Securities Americas Inc. and SunTrust Robinson Humphrey Inc. acted as joint book-running managers for the offering.

BB&T Capital Markets, a division of BB&T Securities LLC, and KeyBanc Capital Markets Inc. served as co-managers. Academy Securities Inc., Great Pacific Securities and Samuel A. Ramirez & Co. Inc. served as junior co-managers.