FiberTower greenshoe fully exercised, augmenting convertibles issue to $402.5 million

By Jennifer Chiou

New York, Nov. 9 - FiberTower Corp.'s $52.5 million greenshoe was exercised in full, raising its issue of 9% convertible senior secured notes due Nov. 15, 2012 to $402.5 million, according to a 10-Q filing with the Securities and Exchange Commission.

After the close on Oct. 25, the company priced $350 million of the six-year convertible notes with an initial conversion premium of 15%.

Jefferies and Co. was the bookrunner of the Rule 144A offering.

As previously announced, the convertibles will accrue interest on a semiannual basis, and FiberTower will put enough in escrow to pay the first two years' interest in cash. The company may pay the third and fourth years' interest in the form of additional notes bearing a coupon of 11%. Interest will be payable in cash only after that.

The initial conversion price was set at $8.29 per share, or an initial conversion rate of 120.627 shares per note.

The convertibles are non-callable for the first four years, after which they may be called subject to a 150% hurdle.

The convertibles have anti-dilution protection.

FiberTower, an Iselin, N.J.-based provider of backhaul and access services to communications companies, said part of the proceeds will be used to fund its capital expenditures to expand its existing network footprint and open new markets. The proceeds will also be used to fund the escrow account for the bonds' interest payments.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.