Omnicell greenshoe exercise lifts convertible size to $575 million

Chicago, Sept. 25 – Initial purchasers of Omnicell Inc.’s 0.25% five-year convertible notes exercised in full their option to purchase an addition $75 million principal amount of notes, increasing the size of the issue to $575 million, according to an 8-K filing with the Securities and Exchange Commission.

Omnicell sold $500 million of the notes on Sept. 22.

The notes have an initial conversion premium of 37.5%.

As previously reported, J.P. Morgan Securities LLC and Wells Fargo Securities LLC were joint bookrunners for the Rule 144A offering.

The notes are non-callable until Sept. 20, 2023 and then subject to a 130% hurdle. They are putable upon a fundamental change.

There is dividend protection.

The notes will be settled in cash, shares or a combination of both at the company’s option.

In connection with the offering, the company entered into convertible note hedge and warrant transactions with a strike price of $141.56 on the warrants, which represents a 100% premium over the last reported sales price of stock.

Approximately $42.9 million of the proceeds will be used to cover the cost of the hedge transactions and $53 million will be used to repurchase shares of common stock from the initial purchasers of the notes at a purchase price of $70.78 per share.

Remaining proceeds will be used to pay down borrowings under the company’s revolving credit facility and for general corporate purposes, which may include potential acquisitions and strategic transactions. Omnicell is a Mountain View, Calif.-based medication management solutions company.

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