By Rebecca Melvin
New York, Sept. 28 - Iridium Communications Inc. priced $100 million of cumulative perpetual convertible preferreds with a $100 per share liquidation preference to yield a dividend of 7% and a 20% initial conversion premium, according to a term sheet.
Raymond James & Associates Inc. was the initial purchaser of the series A preferreds, which were purchased at a discount to par of $98.85 per share. The preferreds were offered at par under Rule 144A and Regulation S.
The preferreds will be convertible at the holders' option at an initial rate of 10.6022 common shares per preferred stock, which is equivalent to an initial conversion price of about $9.43 per share.
The preferreds cannot be converted by the company's option prior to Oct. 3, 2017, and then they are provisionally convertible if common shares are 130% of the conversion price for 20 out 30 consecutive trading days.
There are holder conversion rights in the event of a fundamental change after Oct. 3, 2017.
Proceeds will be used to help fund the continued development of Iridium NEXT satellite construction and deployment and for other general corporate purposes.
The company intends to list the preferred on the Nasdaq global select market six months after the settlement date.
Iridium is a McLean, Va.-based mobile satellite service company.
| Issuer: | Iridium Communications Inc.
|
| Issue: | Convertible perpetual preferred stock (1 million shares)
|
| Amount: | $100 million
|
| Maturity: | Perpetual
|
| Bookrunner: | Raymond James & Associates Inc.
|
| Dividend: | 7%
|
| Liquidation price: | $100
|
| Yield: | 7%
|
| Initial conversion premium: | 20%
|
| Initial conversion price: | $9.43
|
| Initial conversion rate: | 10.6022 shares
|
| Provisional call: | On or after Oct. 3, 2017 at issuer's option at 130% hurdle
|
| Distribution: | Rule 144A and Regulation S
|
| Pricing date: | Sept. 27
|
| Settlement date: | Oct. 3
|
| Stock symbol: | Nasdaq: IRDM
|
| Stock reference price: | $7.86, as of close Sept. 27
|
| Market capitalization: | $535.1 million
|
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