New York, April 22 - The Nasdaq Stock Market, Inc. said it will sell $205 million convertible notes to help finance its acquisition of Instinet Group Inc.
The New York-based market will also restructure its existing $240 million of convertibles notes as part of the transaction.
The notes will be sold to Hellman & Friedman LLC and Silver Lake Partners.
They will pay a 3.75% coupon and convert into Nasdaq stock at $14.50 per share. Silver Lake will receive 1.56 million warrants and Hellman & Friedman will receive 0.65 million warrants, both with a $14.50 exercise price.
In addition to the convertibles, Nasdaq also has a commitment for $750 million in six-year senior term debt, with JPMorgan and Merrill Lynch acting as joint lead arrangers and joint bookrunners.
Nasdaq's existing convertibles, placed with Hellman & Friedman, will be amended to assist the transaction. The maturity date will be extended to May 2012, the coupon cut to 3.75% from 4% and the conversion price lowered to $14.50 from $20.00. Hellman & Friedman will receive 2.75 million warrants with an exercise price of $14.50 per share.
The new financing will be used to fund Nasdaq's $934.5 million cash payment to Instinet's stockholders.
The notes have been issued. If the acquisition does not go through they will be redeemed at par.
| Issuer: | Nasdaq Stock Market, Inc.
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| Issue: | Convertible notes
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| Amount: | $205 million
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| Coupon: | 3.75%
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| Conversion price: | $14.50
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| Warrants: | For 2.21 million shares
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| Warrants strike price: | $14.50
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| Investors: | Hellman & Friedman LLC, Silver Lake Partners
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| Announcement date: | April 22
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| Stock price: | $10.65 at close April 21, $13.43 at close April 22
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