LendingTree offers $200 million five-year convertible notes at 0.5%-1% yield, up 27.5%-32.5%

By Stephanie N. Rotondo

Seattle, May 23 – LendingTree Inc. is offering $200 million of convertible senior notes due June 1, 2022 via a Rule 144A placement, the company said in a press release on Tuesday.

Price talk is for a 0.5% to 1% yield and an initial conversion premium of 27.5% to 32.5%, according to a market source.

BofA Merrill Lynch, Goldman Sachs & Co., RBC Capital Markets and SunTrust Robinson Humphrey Inc. are the joint bookrunners.

There is a $30 million over-allotment option.

Conversions will be settled in cash, common stock or a combination of the two, at the company’s election.

Prior to Feb. 1, 2022, the bonds are contingently convertible if the stock hits a 130% price hurdle. After that date, the paper can be converted at any time.

In connection with the offering, the company plans to enter into convertible note hedge transactions with one or more initial purchasers of the new issue. The company also expects to enter into warrant transactions with option counterparties.

Proceeds will be used, in part, to cover the cost of the hedging transactions. The remaining fees will be used for general corporate purposes, including working capital and potential acquisitions.

LendingTree is a Charlotte, N.C.-based online loan marketplace.

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