By Stephanie N. Rotondo
Seattle, July 26 – Team Inc. priced an upsized $200 million of six-year convertible senior notes at par to yield 5% with an initial conversion premium of 40%, according to a press release issued Wednesday.
The deal came within price talk for a 4.75% to 5.25% yield and an initial conversion premium of 37.5% to 42.5%.
The amount was increased from $175 million.
J.P. Morgan Securities LLC and BofA Merrill Lynch are the joint bookrunners for the Rule 144A offering.
There is a $30 million over-allotment option, increased from $26.25 million.
Conversions will be settled in cash, common stock, or a combination of the two, at the company’s option. The initial conversion rate is 46.0829 shares per each $1,000 of notes, equal to a conversion price of $21.70 a share.
The convertibles become redeemable on Aug. 5, 2021, under certain circumstances, including if the stock price hits a 130% price hurdle.
Proceeds will be used to repay all outstanding borrowings under the term loan portion of a banking credit facility, as well as borrowings under a revolving credit facility, and for general corporate purposes.
Team is a Sugar Land, Texas-based provider of specialty industrial services.
| Issuer: | Team Inc.
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| Securities: | Convertible senior notes
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| Amount: | $200 million
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| Greenshoe: | $30 million
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| Maturity: | Aug. 1, 2023
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| Bookrunners: | J.P. Morgan Securities LLC and BofA Merrill Lynch
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| Co-managers: | BB&T Capital Markets and BBVA Securities Inc.
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| Coupon: | 5%
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| Price: | Par of $1,000
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| Yield: | 5%
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| Conversion premium: | 40%
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| Conversion price: | $21.70 a share
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| Conversion rate: | 46.0829 shares
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| Provisional call: | On or after Aug. 5, 2021 if the stock price hits a 130% price hurdle
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| Net share settlement: | Yes
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| Pricing date: | July 26
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| Settlement date: | July 31
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| Distribution: | Rule 144A
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| Talk: | 4.75% to 5.25% yield, up 37.5% to 42.5%
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| Stock symbol: | NYSE: TISI
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| Stock price: | $15.50 as of July 25 close
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| Market capitalization: | $462.131 million
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