By Rebecca Melvin
New York, Oct. 30 – Winnebago Industries Inc. priced $270 million of convertible senior notes due 2025 at par to yield 1.5% with an initial conversion premium of 32.5%, according to a syndicate source on Wednesday.
Pricing came at the tight end of talked terms, which were for a 1.5% to 2% yield and a 27.5% to 32.5% premium.
There is a $30 million greenshoe for the Rule 144A deal, which was sold via joint bookrunners Goldman Sachs & Co. LLC and BMO Capital Markets Corp.
The notes have net share settlement and takeover protection.
In connection with the notes offering, the company entered into privately negotiated convertible note hedge and warrant transactions with initial purchasers of the notes. The $96.20 warrant strike price represents an initial conversion premium of 100% from the issuer’s perspective.
The proceeds will be used to fund the cost of entering into the convertible note hedge transactions and for the company’s previously announced acquisition of Newmar Corp. If the Newmar acquisition is not consummated, the proceeds will be used for fees related to cancelation of the deal and for general corporate purposes.
The Forest City, Iowa-based company makes recreational vehicles.
| Issuer: | Winnebago Industries Inc.
|
| Issue: | Senior convertible notes
|
| Amount: | $270 million
|
| Greenshoe: | $30 million
|
| Maturity: | April 1, 2025
|
| Bookrunners: | Goldman Sachs & Co. LLC and BMO Capital Markets Corp.
|
| Coupon: | 1.5%
|
| Price: | Par
|
| Yield: | 15%
|
| Conversion premium: | 32.5%
|
| Conversion price: | $63.73
|
| Conversion rate: | 15.6906
|
| Call spread: | Yes, warrant strike of $96.20, represents an initial conversion premium of 100% from the issuer’s perspective
|
| Takeover protection: | Yes
|
| Trade date: | Oct. 29
|
| Settlement date: | Nov. 1
|
| Distribution: | Rule 144A
|
| Price talk: | 1.5%-2%, up 27.5%-32.5%
|
| Listing: | NYSE: WGO
|
| Stock reference price: | $48.10 closing price on Oct. 29
|
| Market capitalization: | $1.52 billion
|
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