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A. Schulman plans $110 million offering of cumulative perpetual convertible special stock
New York, April 27 – A. Schulman, Inc. announced a $110 million offering of cumulative perpetual convertible special stock.
J.P. Morgan Securities LLC and BofA Merrill Lynch are bookrunners for the sale, which is registered with the Securities and Exchange Commission.
Co-managers for the transaction are Commerz Markets LLC, BBVA Securities Inc., Citigroup Global Markets Inc. and RBS Securities Inc.
There is a greenshoe for a further $15 million of special stock.
Proceeds from the sale will be used to help fund the $800 million acquisition of HGGC Citadel Plastics Holdings, Inc.
If the acquisition is not completed, proceeds will be used for general corporate purposes.
A. Schulman will be able to force conversion of the special stock after May 1, 2020 subject to a 150% stock-price hurdle.
The special stock will rank senior to the company’s common stock and all future capital stock not specifically as identified as ranking senior to or having parity with the special stock. The special stock will rank junior to any future capital stock identified as having seniority and will also be junior to all existing and future debt, including that of A. Schulman’s subsidiaries.
Voting rights will only be granted to special stock holders if the dividend is in arrears for six or more quarterly periods. Should that happen, special stock holders will be able to vote on an as-converted basis with holders of the company’s common stock.
No stock with a more senior ranking can be issued without approval of holders of 66 2/3% of holders of the special stock.
A. Schulman is an Akron, Ohio-based supplier of high-performance plastic compounds, powders and resins.
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