Coupa talks $1.1 billion six-year convertible notes to yield 0.125%-0.625%, up 30%-35%

By Abigail W. Adams

Portland, Me., June 9 – Coupa Software Inc. plans to price $1.1 billion of six-year convertible notes after the market close on Wednesday with price talk for a coupon of 0.125% to 0.625% and an initial conversion premium of 30% to 35%, according to a market source.

Goldman Sachs & Co. LLC, BofA Securities Inc., Barclays and J.P. Morgan Securities LLC are joint bookrunners for the Rule 144A offering, which carries a greenshoe of $165 million.

The notes are non-callable until June 20, 2023 and then subject to a 130% hurdle.

They are putable upon a fundamental change.

The notes will be settled in cash, shares or a combination of both at the company’s option.

In connection with the pricing of the notes, the company will enter into capped call transactions.

Proceeds will be used to cover the cost of the call spread, to repurchase for cash a portion of its 0.375% convertible notes due 2023 and for general corporate purposes, which may include potential acquisitions or strategic transactions.

Coupa is a San Mateo, Calif.-based cloud platform for business spend management.

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