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MarketScreener Homepage  >  Equities  >  Nyse  >  Southern Company    SO

SOUTHERN COMPANY

(SO)
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Southern : Free Writing Prospectus - Filing under Securities Act Rules 163/433

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08/14/2019 | 06:22am EDT

Filed pursuant to Rule 433

Registration No. 333-223128

August 13, 2019

PRICING TERM SHEET

(To Preliminary Prospectus Supplement dated August 12, 2019)

Issuer:

The Southern Company (the "Company")

Designation:

2019 Series A Equity Units (each being referred to as an "Equity Unit") that will each have a stated amount of

$50 and will initially be in the form of a 2019 Series A Corporate Unit (each being referred to as a "Corporate

Unit") consisting of a purchase contract issued by the Company and, initially, a 1/40 undivided beneficial

ownership interest in $1,000 principal amount of Series 2019A Remarketable Junior Subordinated Notes due

2024 to be issued by the Company (the "Series 2019A RSNs") and a 1/40 undivided beneficial ownership

interest in $1,000 principal amount of Series 2019B Remarketable Junior Subordinated Notes due 2027 to be

issued by the Company (the "Series 2019B RSNs" and, together with the Series 2019A RSNs, the "RSNs")

Number of

Equity Units

30,000,000 (or 34,500,000 if the underwriters exercise their option to purchase up to 4,500,000 additional

Offered:

Corporate Units in full, solely for the purpose of covering over-allotments)

Aggregate

Equity Units

Offering

$1,500,000,000 (or $1,725,000,000 if the underwriters exercise their option to purchase up to 4,500,000

Amount:

additional Corporate Units in full, solely for the purpose of covering over-allotments)

Stated

$50.00

Amount per

Equity Unit:

Public

Offering

The Corporate Units are being offered to the public at a price of $50 per Corporate Unit, for a total of

Price;

$1,500,000,000 (or $1,725,000,000 if the underwriters exercise their option to purchase up to 4,500,000

Underwriting

additional Corporate Units in full, solely for the purpose of covering over-allotments). The Company's

Discounts

proceeds from the offering (after underwriting discounts totaling $37,500,000 and before expenses) will equal

and

$1,462,500,000 (or $1,681,875,000 if the underwriters exercise their option to purchase up to 4,500,000

Commissions

additional Corporate Units in full, solely for the purpose of covering over-allotments).

Interest Rate

on the Series

2019A

2.70% per year subject to the Company's right to defer interest payments, as described in the Preliminary

RSNs:

Prospectus Supplement, and subject to modification in connection with a successful remarketing

Interest Rate

on the Series

2019B

2.70% per year subject to the Company's right to defer interest payments, as described in the Preliminary

RSNs:

Prospectus Supplement, and subject to modification in connection with a successful remarketing

Deferred

Deferred interest on either series of RSNs will bear interest at the interest rate applicable to such series of

Interest on

RSNs, compounded on each interest payment date to, but excluding, the interest payment date on which such

the RSNs:

deferred interest is paid

Contract

Adjustment

Payment

4.05% per year or $2.0250 per year on the Stated Amount per Equity Unit subject to the Company's right to

Rate:

defer contract adjustment payments, as described in the Preliminary Prospectus Supplement

Deferred

Deferred contract adjustment payments will accrue additional contract adjustment payments at the rate equal

Contract

to 6.75% per annum compounded on each contract adjustment payment date to, but excluding, the contract

Adjustment

adjustment payment date on which such deferred contract adjustment payments are paid, subject to

Payments:

applicable law

Total

6.75% per annum

Distribution

Rate on the

Corporate

Units:

Reference

Price:

$57.20 (subject to adjustment, as described in the Preliminary Prospectus Supplement)

Threshold

Appreciation

$68.64 (subject to adjustment, as described in the Preliminary Prospectus Supplement), which represents

Price:

appreciation of 20.0% over the Reference Price

Minimum

0.7284 shares of the Company's common stock (subject to adjustment, as described in the Preliminary

Settlement

Prospectus Supplement), which is approximately equal to the $50.00 Stated Amount per Equity Unit, divided

Rate:

by the Threshold Appreciation Price

Maximum

0.8741 shares of the Company's common stock (subject to adjustment, as described in the Preliminary

Settlement

Prospectus Supplement), which is approximately equal to the $50.00 Stated Amount per Equity Unit, divided

Rate:

by the Reference Price

Purchase

August 1, 2022 (or if such day is not a business day, the following business day)

Contract

Settlement

Date:

Series 2019A

August 1, 2024

RSN Maturity

Date:

Series 2019B

RSN Maturity

Date:

August 1, 2027

Joint Book-

Goldman Sachs & Co. LLC

Running

Barclays Capital Inc.

Managers:

Citigroup Global Markets Inc.

Morgan Stanley & Co. LLC

BNP Paribas Securities Corp.

BofA Securities, Inc.

J.P. Morgan Securities LLC

Scotia Capital (USA) Inc.

Wells Fargo Securities LLC

Co-Managers:

Mizuho Securities USA LLC

MUFG Securities Americas Inc.

SunTrust Robinson Humphrey, Inc.

U.S. Bancorp Investments, Inc.

BBVA Securities Inc.

Fifth Third Securities, Inc.

PNC Capital Markets LLC

RBC Capital Markets, LLC

TD Securities (USA) LLC

Academy Securities, Inc.

Blaylock Van, LLC

CastleOak Securities, L.P.

Loop Capital Markets LLC

Mischler Financial Group, Inc.

R. Seelaus & Co., LLC

Samuel A. Ramirez & Company, Inc.

The Williams Capital Group, L.P.

Listing:

The Company intends to apply to list the Corporate Units on the New York Stock Exchange and expects trading

to commence within 30 days of the date of initial issuance of the Corporate Units under the symbol "SOLN"

Transaction

Date:

August 13, 2019

Settlement

Date:

August 16, 2019

CUSIP/ISIN

for the

Corporate

Units:

842587 602/US8425876021

CUSIP/ISIN

for the

Treasury

Units:

842587 701/US8425877011

CUSIP/ISIN

for the

Series

2019A

RSNs:

842587 DC8/US842587DC82

CUSIP/ISIN

for the

Series

2019B

RSNs:

842587 DD6/US842587DD65

Allocation

At the time of issuance, the fair market value of the applicable ownership interest in the RSNs will be $50 (or

of the

100% of the issue price of a Corporate Unit), allocated equally between the Series 2019A RSNs and the Series

Purchase

2019B RSNs underlying such applicable ownership interest in the RSNs, and the fair market value of each

Price:

purchase contract will be $0 (or 0% of the issue price of a Corporate Unit)

Early

Subject to certain conditions described under "Description of the Purchase Contracts-Early Settlement" in the

Settlement:

Preliminary Prospectus Supplement, a holder of Corporate Units or 2019 Series A Treasury Units (each being

referred to as a "Treasury Unit") may settle the related purchase contracts at any time prior to 4:00 p.m., New

York City time, on the second business day immediately preceding the Purchase Contract Settlement Date,

other than during a blackout period (as described in the Preliminary Prospectus Supplement) in the case of

Corporate Units. An early settlement may be made only in integral multiples of 40 Corporate Units or 20

Treasury Units; however, if the Treasury portfolio has replaced the RSNs as a component of the Corporate

Units following a successful optional remarketing, holders of Corporate Units may settle early only in integral

multiples of 20,000 Corporate Units. If a purchase contract is settled early, the number of shares of the

Company's common stock to be issued per purchase contract will be equal to the Minimum Settlement Rate

(subject to adjustment, as described in the Preliminary Prospectus Supplement).

Early Settlement Upon a

Subject to certain conditions described under "Description of the Purchase Contracts

Fundamental Change:

-Early Settlement Upon a Fundamental Change," following a "fundamental

change" (as defined in the Preliminary Prospectus Supplement) that occurs prior to

the 30 th

scheduled trading day preceding the Purchase Contract Settlement Date,

each holder of a purchase contract, subject to certain conditions described in the

Preliminary Prospectus Supplement, will have the right to accelerate and settle the

purchase contract early on the fundamental change early settlement date (as defined

in the Preliminary Prospectus Supplement) at the settlement rate determined as if the

applicable market value were determined, for such purpose, based on the market

value averaging period starting on the 23 rd scheduled trading day prior to the

fundamental change early settlement date and ending on the third scheduled trading

day immediately preceding the fundamental change early settlement date, plus an

additional make-whole amount of shares (such additional make-whole amount of

shares being hereafter referred to as the "make-whole shares"). This right is referred

to as the "fundamental change early settlement right."

The number of make-whole shares per purchase contract applicable to a fundamental

change early settlement will be determined by reference to the table below, based on

the date on which the fundamental change occurs or becomes effective (the

"effective date") and the "stock price" (as defined in the Preliminary Prospectus

Supplement) in the fundamental change:

Stock Price

Effective Date

$20.00

$30.00

$40.00

$50.00

$57.20

$65.00

$68.64

$75.00

$80.00

$90.00

$100.00

$125.00

$150.00

August 16, 2019

0.2142

0.1311

0.0862

0.0385

0.0000

0.0673

0.0938

0.0745

0.0638

0.0508

0.0440

0.0349

0.0410

August 1, 2020

0.1385

0.0865

0.0581

0.0207

0.0000

0.0489

0.0747

0.0554

0.0456

0.0351

0.0304

0.0241

0.0255

August 1, 2021

0.0656

0.0420

0.0298

0.0075

0.0000

0.0294

0.0524

0.0319

0.0238

0.0176

0.0154

0.0123

0.0078

August 1, 2022

0.0000

0.0000

0.0000

0.0000

0.0000

0.0000

0.0000

0.0000

0.0000

0.0000

0.0000

0.0000

0.0000

The stock prices set forth in the second row of the table above (i.e., the column headers) will be adjusted upon the occurrence of certain events requiring anti- dilution adjustments to the fixed settlement rates in a manner inversely proportional to the adjustments to the fixed settlement rates, as described in the Preliminary Prospectus Supplement.

This is an excerpt of the original content. To continue reading it, access the original document here.

Disclaimer

Southern Company published this content on 14 August 2019 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 August 2019 10:21:09 UTC

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Financials (USD)
Sales 2019 21 947 M
EBIT 2019 5 370 M
Net income 2019 4 211 M
Debt 2019 44 733 M
Yield 2019 4,29%
P/E ratio 2019 15,6x
P/E ratio 2020 18,2x
EV / Sales2019 4,78x
EV / Sales2020 4,73x
Capitalization 60 067 M
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Technical analysis trends SOUTHERN COMPANY
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TrendsBullishBullishBullish
Income Statement Evolution
Consensus
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Mean consensus HOLD
Number of Analysts 21
Average target price 56,34  $
Last Close Price 57,48  $
Spread / Highest target 6,12%
Spread / Average Target -1,98%
Spread / Lowest Target -9,53%
EPS Revisions
Managers
NameTitle
Thomas A. Fanning Chairman, President & Chief Executive Officer
Andrew W. Evans Chief Financial Officer & Executive Vice President
Kenneth E. Coleman Chief Information Officer & Senior Vice President
Donald M. James Independent Director
William G. Smith Independent Director
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