By Abigail W. Adams
Portland, Me., Feb. 28 – Five9 Inc. priced an upsized $650 million of five-year convertible notes after the market close on Tuesday at par with a coupon of 1% and an initial conversion premium of 30%, according to a company news release.
Pricing came at the rich end of talk for a coupon of 1% to 1.5% and at the midpoint of talk for an initial conversion premium of 27.5% to 32.5%, according to a market source.
Morgan Stanley & Co. LLC (lead left), Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC were bookrunners for the Rule 144A offering, which carries an upsized greenshoe of $97.5 million.
The initial size of the offering was $600 million with a greenshoe of $90 million.
The notes are non-callable until March 22, 2027 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 offering, the company entered into capped call transactions with a cap price of $122.18, which represents a premium of 100% over the last reported sales price of stock.
The company will repurchase $313.1 million of its outstanding 0.5% convertible notes due 2025 for $304.9 million in cash.
Net proceeds are expected to be $633.5 million or will be $728.8 million if the greenshoe is exercised in full.
Approximately $81.3 million of net proceeds will be used to cover the cost of the call spread, $304.9 million will be used to fund the repurchase of the 0.5% convertible notes due 2025 with any remaining amounts to be used for general corporate purposes.
Five9 is a San Ramon, Calif.-based provider of cloud contact center software.
| Issuer: | Five9 Inc.
|
| Amount: | $650 million
|
| Greenshoe: | $97.5 million
|
| Issue: | Convertible senior notes
|
| Maturity: | March 15, 2029
|
| Bookrunners: | Morgan Stanley & Co. LLC (lead left), Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC
|
| Coupon: | 1%
|
| Price: | Par
|
| Yield: | 1%
|
| Conversion premium: | 30%
|
| Conversion price: | $79.42
|
| Conversion rate: | 12.5918
|
| Call options: | Non-callable until March 22, 2027 and then subject to a 130% hurdle
|
| Put options: | Upon a fundamental change
|
| Pricing date: | Feb. 27
|
| Settlement date: | March 1
|
| Distribution: | Rule 144A
|
| Talk: | Coupon of 1% to 1.5% and initial conversion premium of 27.5% to 32.5%
|
| Stock symbol: | Nasdaq: FIVN
|
| Stock price: | $61.09 at market close Feb. 27
|
| Market capitalization: | $4.44 billion
|
|
|
© 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.
