Duke Energy Cap Trust II $250M 7.2% Pfd Rtd A+ By Fitch IBCA.NEW YORK--(BUSINESS WIRE)--June 10, 1999-- Duke Energy Capital Trust II's (the Trust's) $250 million 7.20% trust preferred securities are rated 'A+' by Fitch IBCA IBCA International Braille Chess Association IBCA Institute of Burial and Cremation Administration IBCA Integrated Business Communications Alliance IBCA International Barbeque Cookers Association IBCA Department of Interior Board of Contract Appeals . The Trust is a special purpose entity organized by Duke Energy Corp. for the sole purpose of issuing the trust preferred securities and lending the proceeds to Duke Energy Corp. The Trust will hold Duke Energy's junior subordinated deferrable interest notes and the receipt of interest and principle on the notes will provide the sole funding source for the trust preferred securities. The trust preferred securities will be subject to mandatory redemption upon repayment of the junior subordinated notes. Duke Energy Corp. will have the right to defer de·fer 1 v. de·ferred, de·fer·ring, de·fers v.tr. 1. To put off; postpone. 2. To postpone the induction of (one eligible for the military draft). v.intr. interest payments on the junior subordinated notes for up to five years, in which case quarterly distributions on the trust preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. may be deferred by the Trust. If Duke Energy Corp. exercises its right to defer interest payments on the subordinated notes, Duke Energy Corp. cannot pay dividends on any shares of its capital stock. The subordinated notes are junior and subordinate to all senior debt of Duke Energy Corp. The rating reflects Duke Energy's strong credit quality and reliance on regulated businesses for about 84% of earnings before interest and taxes In financial and business accounting, earnings before interest and taxes (EBIT) is a measure of a firm's profitability that excludes interest and income tax expenses.[1] EBIT = Operating Revenue – Operating Expenses + Non-operating Income (EBIT EBIT See: Earnings Before Interest and Taxes EBIT See earnings before interest and taxes (EBIT). ). Fitch IBCA expects recent acquisitions and an aggressive investment program that emphasizes global asset development and domestic field services will over time reduce the proportion of regulated EBIT, and could ultimately affect credit quality of the Duke Energy group. While capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. on non-regulated activities could be substantial, a significant portion will be discretionary. On balance, credit measures for Duke Energy Corp. are expected to be consistent with the new ratings. |
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion