U.S.-based electric utility holding company Xcel Energy Inc. announced the commencement of a registered underwritten offering of $400 million of shares of its common stock.

In connection with the offering, Xcel Energy expects to enter into a forward sale agreement with Morgan Stanley & Co. LLC, the forward purchaser, under which Xcel Energy will agree to issue and sell to the forward purchaser an aggregate of $400 million of shares of its common stock.

Additionally, the shares will be sold at an initial forward sale price per share equal to the price per share at which the underwriters purchase the shares in the offering, subject to certain adjustments, upon physical settlement of the forward sale agreement

In addition, the underwriters of the offering expect to be granted a 30-day option to purchase up to an additional $60 million of shares of Xcel Energy’s common stock upon the same terms.