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Duke Energy Ohio sells $800M of 1st mortgage bonds

Duke Energy Ohio Inc. sold $800 million of first mortgage bonds to repay at maturity $450 million of its 5.45% bonds due April 1.

The Duke Energy Corp. subsidiary also will use the proceeds to pay down a portion of its outstanding commercial paper and for general corporate purposes. As of Dec. 14, 2018, Duke Energy Ohio had $148 million of outstanding short-term, money-pool and commercial paper borrowings.

The offering consisted of $400 million of 3.65% bonds due Feb. 1, 2029; and $400 million of 4.30% bonds due Feb. 1, 2049. Interest on both bonds is payable semiannually Feb. 1 and Aug. 1, starting Aug. 1, according to a free writing prospectus filed Jan. 3.

The 2029 bonds have a spread to benchmark Treasury of 110 basis points, while the 2049 bonds offer a spread to benchmark Treasury of 140 basis points. Both issues were rated A2 by Moody's and A by S&P Global Ratings.

Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC, Goldman Sachs & Co. LLC and U.S. Bancorp Investments Inc. acted as joint book-running managers. BB&T Capital Markets, a division of BB&T Securities LLC, BNY Mellon Capital Markets LLC and The Williams Capital Group LP served as co-managers.