Synaptics greenshoe exercise increases convertibles to $525 million

By Angela McDaniels

Tacoma, Wash., June 26 – The underwriters of Synaptics Inc.’s five-year convertible notes exercised their $25 million over-allotment option in full, increasing the size of the issue to $525 million.

As previously reported, the company priced an upsized $500 million of the convertibles on June 20 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 bookrunner. Co-managers were BMO Capital Markets Corp., MUFG, HSBC Securities (USA) Inc., U.S. Bancorp Investments Inc. and BofA Merrill Lynch.

The greenshoe was exercised Wednesday, and the issue settled Monday.

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.

Proceeds will be used to pay off about $123.8 million outstanding under a term loan, to buy back $94 million of common stock and to partially fund the cash portion of the 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.

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