Five9 greenshoe lifts 1% five-year convertibles to $747.5 million

By Angela McDaniels

Tacoma, Wash., Feb. 29 – Five9 Inc. said the $97.5 million greenshoe for its 1% convertible senior notes due 2029 was exercised in full, increasing the size of the issue to $747.5 million.

As previously reported, the issuer priced an upsized $650 million of the convertibles after the market close on Tuesday at par with an initial conversion premium of 30%.

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.

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%.

Proceeds will be used for the capped call transactions, to repurchase $313.1 million of the company’s outstanding 0.5% convertible notes due 2025 for $304.9 million in cash and for working capital and other general corporate purposes.

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

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