By Kenneth Lim
Boston, June 12 - Symantec Corp. on Monday reoffered a $2 billion two-tranche deal of convertible senior unsecured notes at the cheap end of revised talk, selling the securities at 99.5 points apiece.
The $1 billion tranche of five-year convertibles have a coupon of 0.75% and an initial conversion premium of 22.5%. The reoffer range was talked at 99.5 to 99.75 after terms were cheapened from the company's original plan to the five-year notes at par with a coupon of 0.25% to 0.75% and an initial conversion premium of 22.5% to 27.5%.
The $1 billion series of seven-year convertibles have a coupon of 1% and an initial conversion premium of 22.5%. Again the deal was cheapened from talk. The seven-year paper was originally offered at par with a coupon of 0.5% to 1% and an initial conversion premium of 22.5% to 27.5%.
There is an over-allotment option of $100 million per tranche.
Citigroup, Morgan Stanley and UBS Investment Bank were the bookrunners of the Rule 144A offering.
The convertibles are non-callable for life and there are no investor puts.
There is a contingent conversion threshold at 130% of the conversion price.
The convertibles have full dividend protection and a change of control put with a make-whole premium feature.
There is a net-share settlement feature.
Cupertino, Calif.-based Symantec said it will use the proceeds to buy back $1.5 billion of its common stock, some of which will be bought through private block trades, and to enter into convertible note hedge and warrant transactions. Symantec will also enter into separate warrant transactions with the underwriters, and those warrants will have a strike price about 75% above Symantec's stock price. Any remaining proceeds will be used as working capital and for general corporate purposes.
Symantec shares closed at $15.63 on Monday, up by 1.49% or 23 cents, after the deal was announced.
| Issuer: | Symantec Corp.
|
| Issue: | Convertible senior unsecured notes
|
| Bookrunner: | Citigroup, Morgan Stanley and UBS Investment Bank
|
| Net-share settlement option: | Yes
|
| Dividend protection: | Yes
|
| Takeover protection: | Change of control put with premium make-whole
|
| Call protection: | Non-callable for life
|
| Puts: | None
|
| Contingent conversion: | 130%
|
| Pricing date: | June 12 after the close
|
| Settlement date: | June 16
|
|
|
| Five-year tranche
|
| Amount: | $1 billion
|
| Greenshoe: | $100 million
|
| Maturity: | June 15, 2011
|
| Coupon: | 0.75%
|
| Price: | Reoffered at 99.5
|
| Conversion premium: | 22.5%
|
| Conversion price: | $19.12
|
| Conversion ratio: | 52.2951
|
| Price talk: | 0.25%-0.75%, up 22.5%-27.5%
|
|
|
| Seven-year tranche
|
| Amount: | $1 billion
|
| Greenshoe: | $100 million
|
| Maturity: | June 15, 2013
|
| Coupon: | 1%
|
| Price: | Reoffered at 99.5
|
| Conversion premium: | 22.5%
|
| Conversion price: | $19.12
|
| Conversion ratio: | 52.2951
|
| Price talk: | 0.5%-1%, up 22.5%-27.5%
|
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