By Kenneth Lim
Boston, May 9 - SanDisk Corp. on Tuesday priced $1 billion of 7-year convertible senior notes within talk at a coupon of 1% and an initial conversion premium of 30%, syndicate sources confirmed.
Price talk guided for a coupon of 0.75% to 1.25% and an initial conversion premium of 27.5% to 32.5%. The notes were offered at par, and there will be convertible note hedge and warrant transactions to increase the effective premium of the deal.
There is a greenshoe option for a further $150 million.
Morgan Stanley and Goldman Sachs were the bookrunners of the registered off-the-shelf deal.
The notes are non-callable for life, and they may not be put except in a change of control.
The notes may be converted into SanDisk shares if the stock price exceeds 120% of the conversion price.
There is full dividend protection, and takeover protection includes a premium make-whole feature.
There is a net-share settlement feature that lets the company settle conversions in cash up to the principal amount of $1,000 per note.
SanDisk is a Sunnyvale, Calif.-based maker of flash storage cards used in consumer electronics. The proceeds of the offering will be used for general corporate purposes including capital expenditures. The proceeds may also pay for strategic investments and acquisitions, although SanDisk said it has no specific acquisition commitments at the moment. Part of the proceeds will also be used for the note hedging transactions.
SanDisk stock (Nasdaq: SNDK) closed at $65.35 on Tuesday, down 2.09% or $1.35.
| Issuer: | SanDisk Corp.
|
| Issue: | Convertible senior notes
|
| Bookrunner: | Morgan Stanley, Goldman Sachs
|
| Amount: | $1 billion
|
| Greenshoe: | $150 million
|
| Maturity: | May 15, 2013
|
| Coupon: | 1%
|
| Price: | Par
|
| Yield: | 1%
|
| Conversion premium: | 30%
|
| Conversion price: | $84.955
|
| Conversion ratio: | 11.7709
|
| Contingent conversion: | 120%
|
| Net-share settlement: | Yes
|
| Dividend protection: | Yes
|
| Takeover protection: | Change of control put and premium make-whole
|
| Call protection: | Non-callable for life
|
| Puts: | None
|
| Price talk: | 0.75%-1.25%, up 27.5%-32.5%
|
| Pricing date: | May 9
|
| Settlement date: | May 15
|
| Distribution: | Registered
|
| Symbol: | Nasdaq: SNDK
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
