By Kenneth Lim
Boston, Nov. 8 - Hornbeck Offshore Services Inc. on Tuesday priced an upsized $220 million of 20-year convertible senior notes at the rich end of talk, at a coupon of 1.625% and an initial conversion premium of 37.5%.
The deal amount was originally $200 million, and price talk was for a coupon of 1.625% to 2.125% and an initial conversion premium of 32.5% to 37.5%.
The coupon will decline to 1.375% from the seventh year.
The notes will be offered at par.
There is a greenshoe for a further $30 million.
Jefferies and Co. and Bear Stearns were the bookrunners of the Rule 144A offering.
The convertibles are non-callable for the first five years and may be called subject to a 135% hurdle in years six and seven. There are puts in years seven, 10 and 15.
There is dividend and takeover protection.
Hornbeck, a Covington, La.-based provider of offshore supply vessels to the oil and gas industry, said part of the proceeds will be used to fund convertible note hedge and warrant transactions. The company also earmarked 30% of the proceeds to buy back its common stock, and for general purposes that could include acquisitions.
| Issuer: | Hornbeck Offshore Services Inc.
|
| Issue: | Convertible senior notes
|
| Bookrunners: | Jefferies and Co. and Bear Stearns
|
| Amount: | $220 million
|
| Greenshoe: | $30 million
|
| Maturity: | Nov. 15, 2026
|
| Coupon: | 1.625%, reset to 1.375% starting Nov. 15, 2013
|
| Price: | Par
|
| Yield: | 1.625%
|
| Conversion premium: | 37.5%
|
| Conversion price: | $48.48
|
| Conversion ratio: | 20.6260
|
| Dividend protection: | Yes
|
| Takeover protection: | Yes
|
| Call protection: | Non-callable before Nov. 15, 2011, thereafter subject to 135% hurdle before Nov. 15, 2013
|
| Puts: | Nov. 15, 2013; Nov. 15, 2016; Nov. 15, 2021
|
| Price talk: | 1.625%-2.125%, up 32.5%-37.5%
|
| Pricing date: | Nov. 7 after the close
|
| Settlement date: | Nov. 13
|
| Distribution: | Rule 144A
|
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