Limelight greenshoe increases 3.5% convertibles to $125 million

By Wendy Van Sickle

Columbus, Ohio, July 27 – Underwriters for Limelight Networks Inc.’s five-year convertible notes fully exercised their $15 million greenshoe, lifting the total deal size to $125 million, according to an 8-K filing with the Securities and Exchange Commission.

The company priced an upsized $110 million of the convertibles after the market close on Wednesday at the cheap end of talk with a coupon of 3.5% and an initial conversion premium of 27.5%, as previously reported.

Price talk was for a coupon of 3% to 3.5% and an initial conversion premium of 27.5% to 32.5%, according to a market source.

Goldman Sachs & Co. LLC was the bookrunner for the Rule 144A offering.

The initial size of the offering was $100 million.

The notes are contingently convertible until May 1, 2025.

The securities are non-callable until Aug. 4, 2023 and then subject to a 130% hurdle.

The notes are putable upon a fundamental change. There is dividend protection.

In connection with the pricing, the company entered into capped call transactions with a cap price of $13.38, which represents a premium of 100% over the last reported sales price of stock.

Net proceeds are expected to be $106.3 million. Approximately $14.4 million will be used to cover the cost of the call spread with the remaining amount to be used for working capital and general corporate purposes.

Limelight is a Scottsdale, Ariz.-based content delivery network service.

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