Vistra Corp. (NYSE:VST) said Thursday it priced a $1.5 billion public offering of junior subordinated notes due in 2057.

The energy company plans to use the proceeds for general corporate purposes. That includes potentially redeeming outstanding preferred stock later this year.

Vistra Sets Interest Rates

The offering consists of $850 million of Series A junior subordinated notes and $650 million of Series B notes. Both were priced at 100% of their face value.

The Series A notes will initially carry a 7% annual interest rate. Meanwhile, the Series B notes will initially bear interest at 7.25%.

The notes will be unsecured obligations of Vistra Operations Company LLC, an indirect wholly owned subsidiary of Vistra. Vistra will fully and unconditionally guarantee the notes.

The offering is expected to close Sept. 24, subject to customary closing conditions.

Proceeds Could Fund Preferred Stock Redemptions

Vistra plans to use part of the proceeds to potentially redeem some or all of two outstanding preferred stock series.

Those include its 8% Series A fixed-rate reset cumulative redeemable perpetual preferred stock and 7% Series B fixed-rate reset cumulative redeemable green perpetual preferred stock.

Their five-year reset dates fall in October and December, respectively.

Until Vistra deploys the funds, it plans to invest the proceeds in short-term interest-bearing accounts, securities or similar investments.

The offering follows a shelf registration statement filed with the Securities and Exchange Commission on Sept. 9.

Barclays, BofA Securities, Mizuho, MUFG and Truist Securities are among the joint book-running managers for the offering.

Stock Performance

Vistra stock rose about 1% in Friday premarket trading as broader market sentiment improved. Nasdaq futures gained 0.65%, while S&P 500 futures rose 0.61%.

The stock is trying to extend its rebound from late-summer lows. However, the stock remains below key longer-term moving averages.

Vistra trades 4.4% above its 20-day simple moving average of $142.65 and roughly in line with its 50-day SMA of $148.95. However, it remains 1.9% below its 100-day SMA of $151.78 and 5.4% below its 200-day SMA of $157.38.

Its relative strength index stands at 52.58, signaling neutral momentum. Resistance sits near $168, while support is around $134.50.

Meanwhile, Vistra carries a Buy consensus rating with an average price forecast of $228.83. Morgan Stanley recently raised its forecast to $227 with an Overweight rating. TD Cowen lowered its forecast to $221 while maintaining a Buy rating. Mizuho initiated coverage with an Outperform rating and a $169 forecast.

Vistra’s Benzinga Edge scores remain weak, including 12.99 for Momentum, 28.19 for Value and 27.27 for Growth.

VST Price Action: Vistra shares rose 1.11% to $148.68 in Friday premarket trading, according to Benzinga Pro.

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