01:43 PM EDT, 06/18/2024 (MT Newswires) -- NextEra Energy (NEE) said Tuesday it will sell $2 billion of equity units to Wells Fargo Securities and BofA Securities for about $1.94 billion in expected net proceeds.

The energy company will issue each unit in a stated amount of $50. Each unit will comprise a contract to purchase the company's common stock in the future and a 5% undivided beneficial ownership interest in a debenture due June 1, 2029, of its NextEra Energy Capital ( NEE ) unit. NextEra Energy said it will guarantee the debentures.

The company's shares were down 3.6% in afternoon trading.

Total annual distributions on the equity units will be at the rate of about 7.3%. Each stock purchase contract will require the holder to buy the company's shares for cash in about three years, based on a price range of $72.31 to $90.38 per share. The company said the higher end of the range reflects a 25% premium over the stock's Monday closing price. The holders are required to complete the stock purchase by no later than June 1, 2027.

NextEra Energy Capital ( NEE ) expects to use the proceeds to help fund investments in energy and power projects and for other general corporate purposes, including the repayment of part of its outstanding commercial paper obligations.

The company expects the transaction to close Thursday.

In April, NextEra Energy reported first-quarter adjusted earnings of $0.91 per share, up from $0.84 a year earlier, while revenue fell to $5.73 billion from $6.72 billion.

Last week, the company said it continues to expect 2024, 2025 and 2026 adjusted EPS in the respective ranges of $3.23 to $3.43, $3.45 to $3.70 and $3.63 to $4. Wall Street is looking for $3.41, $3.68 and $3.99, respectively. For 2027, NextEra Energy said it expected adjusted EPS between $3.85 and $4.32. The consensus is for $4.35.

Price: 69.74, Change: -2.57, Percent Change: -3.55