By Rebecca Melvin
New York, Sept. 19 – Splunk Inc. priced an upsized $1.85 billion of convertible senior notes in two tranches late Tuesday with an initial conversion premium of 27.5%, according to a news release.
The Rule 144A deal size had originally been talked at $1.7 billion.
The $1.1 billion of convertible notes due 2023 priced with a 0.5% coupon. And the $750 million of convertible senior notes due 2025 priced with a 1.125% coupon.
There is a greenshoe for up to an additional $165 million of 2023 notes and up to an additional $112.5 million of 2025 notes.
The five-year tranche was upsized to $1.1 billion from $850 million and was priced at the midpoint of talk for a coupon of 0.25% to 0.75% and the cheap end of talk for an initial conversion premium of 27.5% to 32.5%.
The seven-year tranche was downsized to $750 million and priced at the cheap end of talk for the coupon, which was 0.625% to 1.125%, and at the midpoint of premium talk.
The five-year tranche is non-callable for three years and then subject to a 130% hurdle with a make-whole.
The seven-year tranche is non-callable for four years and then subject to a 130% hurdle with a make-whole.
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 capped call transactions. The capped call price for both tranches will be about $232.62, which represents a premium of about 100% over the stock price.
Proceeds will be used to cover the cost of the call spread, for working capital and for general corporate purposes.
Morgan Stanley & Co. LLC and BofA Merrill Lynch were joint bookrunners for the deal.
Splunk is a San Francisco-based software company focused on analyzing machine-generated big data.
| Issuer: | Splunk Inc.
|
| Issue: | Convertible senior notes
|
| Amount: | $1.85 billion, upsized from $1.7 billion
|
| Greenshoe: | $277.5 million
|
| Bookrunners: | Morgan Stanley & Co. LLC and BofA Merrill Lynch
|
| Conversion premium: | 27.5%
|
| Conversion price: | $148.30
|
| Conversion ratio: | 6.7433
|
| Net share settlement: | Yes
|
| Capped call: | Yes, at about $232.62
|
| Pricing date: | Sept. 18
|
| Settlement date: | Sept. 21
|
| Distribution: | Rule 144A
|
| Stock symbol: | Nasdaq: SPLK
|
| Stock price: | $116.31 per share as of close Sept. 18
|
| Market capitalization: | $16.81 billion
|
|
|
| 2023 notes
|
| Amount: | $1.1 billion
|
| Greenshoe: | $165 million
|
| Maturity: | Sept. 15, 2023
|
| Coupon: | 0.5%
|
| Call: | After Sept. 20, 2021
|
| Price talk: | 0.25%-0.75%, up 27.5%-32.5%
|
|
|
| 2025 notes
|
| Amount: | $750 million
|
| Greenshoe: | $112.5 million
|
| Maturity: | Sept. 15, 2025
|
| Coupon: | 1.125%
|
| Call: | After Sept. 20, 2022
|
| Price talk: | 0.625%-1.125%, up 27.5%-32.5%
|
© 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.
