Vodafone to sell £2.9 billion of mandatory convertibles in two parts

By Rebecca Melvin

New York, Feb. 18 – Vodafone Group plc plans to price about £2.9 billion of mandatory convertible bonds in two tranches with 18-month and three-year maturities, according to a news release.

The coupon on the shorter-dated tranche was talked at 1.2% to 1.5%, and the coupon on the longer-dated tranche was talked at 1.7% to 2%.

The initial conversion price will be determined on the basis of the higher of the £2.1730 closing price of ordinary shares on the London Stock Exchange on Wednesday and the average of the daily volume-weighted average price of shares for three days starting on Feb. 19.

Pricing of the Regulation S convertibles, which will be issued at par, will be announced Feb. 23.

The mandatories will be cash settled, and the deal is being priced together with the purchase of cash-settled call options on Vodafone’s ordinary shares from J.P. Morgan Securities plc and Morgan Stanley & Co. International plc.

Proceeds are earmarked for general corporate purposes and for the purchase of the call options.

Vodafone plans to apply for the bonds to be admitted to trading on the Irish Stock Exchange’s EEA Regulated Market or another recognized stock exchange.

Vodafone is a London-based telecommunications company.

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