Horizon greenshoe lifts 2.75% convertibles due 2022 to $125 million

By Susanna Moon

Chicago, Feb. 1 – Horizon Global Corp. said underwriters fully exercised the $15 million over-allotment option on its 2.75% five-year convertible senior notes due 2022.

This brings the total deal size to $125 million.

Horizon entered into convertible note hedge transactions in connection with the greenshoe exercise with JPMorgan Chase Bank, NA, London Branch, Wells Fargo Bank, NA and Bank of America, NA, according to an 8-K filing with the Securities and Exchange Commission.

As reported, Horizon priced an upsized $110 million of the five-year convertibles on Jan. 26 with a 35% initial conversion premium.

The deal was increased from the originally announced $100 million and came at the rich end of talk for a yield of 2.75% to 3.25% and richer than talk for a premium of 27.5% to 32.5%.

Concurrently, Horizon Global priced 4 million shares of common stock at $18.50 per share.

J.P. Morgan Securities LLC, Wells Fargo Securities LLC, BofA Merrill Lynch and BMO Capital Markets are the joint bookrunners for the convertibles.

The notes are contingently convertible into cash, common stock or a combination.

Proceeds from the convertibles and stock will be used to repay $157.5 million of Horizon Global’s term loan, a paydown increased by $147.5 million due to the upsizing.

Horizon Global is a Troy, Mich.-based designer, manufacturer and distributer of a range of towing, trailering, cargo management, and other related accessory products to the automotive aftermarket, retail, and original equipment channels worldwide.

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