Liberty Media offers $350 million cash convertible notes due 2023 at 1%-1.5% yield, up 27.5%-32.5%

By Stephanie N. Rotondo

Seattle, Jan. 19 – Liberty Media Corp. is offering $350 million of cash convertible senior notes due 2023, according to market sources.

Price talk is for a 1% to 1.5% yield and an initial conversion premium of 27.5% to 32.5%.

Credit Suisse Securities (USA) LLC, Morgan Stanley & Co. LLC, UBS Securities LLC and BofA Merrill Lynch are running the books.

Pricing is expected after Thursday’s close.

There is a $52.5 million over-allotment option.

The notes will be convertible into cash based on a reference price associated with the company’s series C common stock.

The issue is non-callable. There are takeover and anti-dilution protections.

Proceeds will be used to increase the cash consideration payable to selling shareholders of Formula 1 by $400 million. Additionally, the company will be able to hold in treasury about 19 million shares that would have otherwise been issued to the F1 shareholders.

If the F1 acquisition is not completed, proceeds will be used for general corporate purposes, which may include capital expenditures, acquisitions, working capital, repayment of debt and stock repurchases.

Liberty Media is an Englewood, Colo.-based owner and operator of media, communications and entertainment businesses.

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