Rapid7 talks $200 million five-year convertibles to yield 2%-2.5%, up 27.5%-32.5%

By Abigail W. Adams

Portland, Me., April 28 – Rapid7 Inc. plans to price $200 million of five-year convertible notes after the market close on Tuesday with price talk for a coupon of 2% to 2.5% and an initial conversion premium of 27.5% to 32.5%, according to a market source.

Barclays (lead left) and RBC Capital Markets LLC are active bookrunners for the Rule 144A offering, which carries a greenshoe of $30 million.

KeyBanc Capital Markets Inc. is a passive bookrunner.

The notes are non-callable for three years and then subject to a 130% hurdle.

There is dividend protection.

In connection with the pricing of the convertible notes, the company will enter into capped call transactions.

Proceeds will be used to cover the cost of the call spread and for general corporate purposes.

Rapid7 is a Boston-based cybersecurity company.

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