SCANA Added to S&P 500, Celebrates by Issuing New Shares (SCG, JPM)

By Douglas A. McIntyre Updated Apr 28, 4:27AM EDT · Published Dec 29, 2:25PM EST

Cammonopoly_wideweb__430x3250_2 SCANA Corporation (NYSE:SCG), a producer and marketer of electricity, will be added to the Standard & Poor’s 500 Index after the market closes on December 31st. To celebrate the occasion, SCANA is offering 2 million new, registered shares. The company plans to use the funds to finance its capital expenditures and for general corporate purposes. Morgan Stanley & Company, a subsidiary of JP Morgan Chase & Company (NYSE:JPM), is the book-runner.

This is a pretty shrewd move. The offering has not been priced yet, but the stock is trading around $35/share with about 117 million shares outstanding. The new offering doesn’t dilute existing shares much, and provides a nice fund to bolster earnings next year by limiting the amount of cash or borrowing the company will have to use to pay for capex.

The state’s energy regulators have tied annual rate increases to improved infrastructure, and SCANA has taken advantage of the ruling. The company benefited from a rate increase in November that sets SCANA’s allowed return at 10.6% for one of its South Carolina operations, and 10.25% for another.

The stock is trading down about 1% this morning, about 20% off its 52-week high. SCANA reiterated its full-year guidance in October, and expects EPS of $2.90-$3.05 per share for 2008.

Paul Ausick

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Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

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A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.