Five9 talks $200 million five-year convertibles to yield 0% to 0.125%, up 30% to 35%

By Abigail W. Adams

Portland, Me., May 2 – Five9 Inc. plans to price $200 million in five-year convertible notes after the market close on Thursday with price talk for a coupon of 0% to 0.125% and an initial conversion premium of 30% to 35%, according to a market source.

J.P. Morgan Securities LLC and Goldman Sachs & Co. are joint bookrunners for the Rule 144A deal, which carries a greenshoe of $30 million.

The notes are non-callable for three years and then may be redeemed subject to a 130% hurdle with a make-whole. There is takeover and dividend protection.

The notes are convertible into cash, shares or a combination of both at the company’s option, according to a company news release.

In connection with the pricing of the notes, Five9 will enter into capped call transactions with the initial purchasers and their affiliates.

Proceeds will be used to cover the cost of the call spread, to repay debt and for general corporate purposes.

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

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