By Rebecca Melvin
New York, June 21 – Synaptics Inc. priced an upsized $500 million of five-year convertible notes late Tuesday with a 0.5% coupon and 32.5% initial conversion premium, according to a syndicate source.
The Rule 144A deal, which came on an overnight basis, was initially talked at $450 million in size. The deal’s greenshoe was downsized to $25 million from $50 million.
Pricing came at the midpoint of the 0.25% to 0.75% coupon talk and at the cheap end of the 32.5% to 37.5% premium talk.
Wells Fargo Securities LLC was sole bookrunner of the offering that launched after the market close on Tuesday. Co-managers were BMO Capital Markets Corp., MUFG, HSBC Securities (USA) Inc., U.S. Bancorp Investments Inc. and BofA Merrill Lynch.
The notes have contingent conversion at a 130% price trigger and net share settlement. They are non-callable for three years and then provisionally callable if shares exceed the 130% price hurdle.
The notes also have standard dividend and takeover protection.
Proceeds will be used to pay off about $123.8 million outstanding under a term loan facility, to buy back $94 million of common stock under a current stock repurchase program, and to partially fund the cash portion of previously announced acquisitions of Conexant Systems LLC and the Multimedia Solutions Business of Marvell Technology Group.
Based in San Jose, Calif., Synaptics makes touchpads and other interface parts for computers.
| Issuer: | Synaptics Inc.
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| Issue: | Convertible senior unsecured notes
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| Bookrunner: | Wells Fargo Securities LLC
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| Co-managers: | BMO Capital Markets Corp., MUFG, HSBC Securities (USA) Inc., U.S. Bancorp Investments Inc. and BofA Merrill Lynch
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| Amount: | $500 million, upsized from $450 million
|
| Greenshoe: | $25 million, downsized from $50 million
|
| Maturity: | June 15, 2022
|
| Coupon: | 0.5%
|
| Price: | Par
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| Yield: | 0.5%
|
| Conversion premium: | 32.5%
|
| Conversion price: | $73.02
|
| Conversion ratio: | 13.6947
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| Contingent conversion: | Yes, at 130%
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| Net share settlement: | Yes
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| Takeover protection: | Yes
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| Dividend protection: | Yes
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| Call: | Non-callable for 3 years until June 20, 2020, then provisionally callable subject to 130% price hurdle
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| Price talk: | 0.25%-0.75%, up 32.5%-37.5%
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| Pricing date: | June 20
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| Settlement: | June 26
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| Stock symbol: | Nasdaq: SYNA
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| Share price: | $55.11 at close June 20
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| Market capitalization: | $1.97 billion
|
| Distribution: | Rule 144A
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