Five9 talks $650 million five-year convertible notes to yield 0.125%-0.625%, up 30%-35%

By Abigail W. Adams

Portland, Me., May 21 – Five9 Inc. plans to price $650 million of five-year convertible notes after the market close on Thursday 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.

J.P. Morgan Securities LLC, Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC are bookrunners for the Rule 144A offering, which carries a greenshoe of $97.5 million.

The notes are non-callable for three years and then subject to a 130% hurdle with a make-whole.

In connection with the offering, the company plans to purchase or exchange a portion of its 0.125% convertible notes due 2023 for cash, shares or a combination of both in privately negotiated transactions.

The company will also enter into capped call transactions.

Proceeds will be used to cover the cost of the call spread and for the repurchase or exchange of its 0.125% notes due 2023.

Five9 is a San Ramon, Calif.-based provider of cloud contact center software.

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