By Angela McDaniels
Tacoma, Wash., Jan. 25 – BrightSpring Health Services Inc. priced $400 million of $50-par three-year tangible equity units with a 6.75% dividend after the market close on Thursday.
Talk was for a dividend of 6.25% to 6.75%, according to a market source.
Each unit consists of a prepaid stock purchase contract and a senior amortizing note due Feb. 1, 2027.
There is a $60 million greenshoe.
Unless earlier settled, each stock purchase contract will automatically settle on Feb. 1, 2027 for between 3.2733 and 3.8461 shares of BrightSpring’s common stock per purchase contract, subject to adjustment, based on the market value of BrightSpring’s common stock.
Beginning May 1, BrightSpring will pay equal quarterly cash installments of $0.8438 per amortizing note, which will constitute a payment of interest and a partial repayment of principal, and which cash payment in the aggregate per year will be equivalent to 6.75% per year for to each $50 stated amount of units.
Goldman Sachs & Co. LLC, KKR Capital Markets LLC, Jefferies LLC, Morgan Stanley & Co. LLC, UBS Securities LLC, BofA Securities, Inc., Guggenheim Securities, LLC, and Leerink Partners LLC are acting as lead book-running managers for the offerings.
Wells Fargo Securities, LLC, Deutsche Bank Securities Inc., HSBC Securities (USA) Inc., Mizuho Securities USA LLC, BMO Capital Markets Corp., and Loop Capital Markets LLC are also acting as bookrunning managers.
The stock purchase contracts are non-callable until Nov. 1, 2024 and then the company may force an early mandatory settlement of all outstanding contracts.
There is takeover and dividend protection.
The tangible equity units will be listed for trade on the Nasdaq under the symbol “BTSGU.”
The issue is concurrent with the company’s initial public offering of common stock. It priced 53.3 million shares for $13 each for proceeds of $693.33 million. It had planned to raise $950 million through the sale of 53.3 million shares in the $15 to $18 range.
Proceeds will be used to repay debt under the company’s revolving credit facility, first-lien term loan and second-lien term loan and to pay termination fees in relation to a monitoring agreement with Kohlberg Kravis Roberts & Co. LP and Walgreens Boots Alliance, Inc.
BrightSpring Health is a Louisville, Ky.-based home and community-based health services provider.
| Issuer: | BrightSpring Health Services Inc.
|
| Amount: | $400 million
|
| Greenshoe: | $60 million
|
| Units: | 8 million
|
| Issue: | Tangible equity units
|
| Maturity: | Feb. 1, 2027
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| Bookrunners: | Goldman Sachs & Co. LLC, KKR Capital Markets LLC, Jefferies LLC, Morgan Stanley & Co. LLC, UBS Securities LLC, BofA Securities, Inc., Guggenheim Securities, LLC, and Leerink Partners LLC (leads); Wells Fargo Securities, LLC, Deutsche Bank Securities Inc., HSBC Securities (USA) Inc., Mizuho Securities USA LLC, BMO Capital Markets Corp., and Loop Capital Markets LLC
|
| Dividend: | 6.75%
|
| Price: | Par of $50
|
| Yield: | 6.75%
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| Settlement rate: | 3.2733 to 3.8461 shares
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| Call options: | Non-callable until Nov. 1, 2024
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| Pricing date: | Jan. 25
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| Settlement date: | Jan. 30
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| Distribution: | SEC registered
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| Talk: | Dividend of 6.25% to 6.75% and a threshold appreciation premium of 17.5% to 22.5%
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| Stock symbol: | Nasdaq: BTSG
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| Unit symbol: | Nasdaq: BTSGU
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| Stock price: | $13.00
|
| Market cap: | $693.33 million
|
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