Fortive talks $1.25 billion three-year convertible notes to yield 0.875%-1.375%, up 27.5%-32.5%

By Abigail W. Adams

Portland, Me., Feb. 19 – Fortive Corp. plans to price $1.25 billion of three-year convertible notes after the market close on Tuesday with price talk for a coupon of 0.875% to 1.375% and an initial conversion premium of 27.5% to 32.5%, according to a market source.

Barclays, Citigroup Global Markets Inc., BofA Merrill Lynch and BNP Paribas Securities Corp. are the bookrunners for the Rule 144A deal, which carries a greenshoe of $187.5 million.

The notes are non-callable.

The notes will be settled in cash, shares or a combination of both at the company’s option.

Proceeds will be used to fund a portion of the acquisition of the Advanced Sterilization Products business from Johnson & Johnson subsidiary Ethicon, Inc.

If the acquisition is not completed, proceeds will be used for working capital and other general corporate purposes.

Fortive is an Everett, Wash.-based diversified industrial conglomerate.

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