Hornbeck greenshoe exercised in full, raising convertibles issue to $250 million

By Jennifer Chiou

New York, Nov. 13 - Hornbeck Offshore Services Inc. said underwriters fully exercised a $30 million over-allotment option, augmenting its issue of 1.625% convertible senior notes due Nov. 15, 2026 to $250 million.

The company said it expects net proceeds to be $242.8 million.

After the close on Nov. 7, the company priced an upsized $220 million of convertibles at the rich end of talk and an initial conversion premium of 37.5%. As previously announced, 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 convertibles have an initial conversion rate of 20.6260 shares per $1,000 principal amount of notes for a conversion price of $48.48 per share.

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.

Hornbeck added it entered into separate warrant transactions, resulting in gross proceeds of $51.9 million.

© 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.