Viavi to price $400 million seven-year convertible notes to yield 0.5%-1%, up 32.5%-37.5%

By Stephanie N. Rotondo

Seattle, Feb. 27 – Viavi Solutions Inc. is selling $400 million of senior unsecured convertible notes due 2024, the company said in a press release on Monday.

Price talk is for a 0.5% to 1% yield and an initial conversion premium of 32.5% to 37.5%, according to a market source.

Pricing of the Rule 144A deal is expected after Monday’s close.

J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC and Credit Suisse Securities (USA) LLC are the joint bookrunners.

The deal includes a $60 million over-allotment option.

The convertibles are non-callable for life. Holders can convert their debt holdings in certain circumstances into cash, stock or a combination of the two, at the company’s election.

Proceeds will be used, along with cash on hand, to refinance the outstanding 0.625% senior convertible notes due 2033 via opportunistic repurchases concurrently with this offering or in the future. The funds will also be used for general corporate purposes and to repurchase common stock.

Viavi is a Milpitas, Calif.-based network test, measurement and assurance technology company.

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