Fortive greenshoe ups 0.875% three-year convertibles to $1.44 billion

By Wendy Van Sickle

Columbus, Ohio, Feb. 22 – Underwriters for Fortive Corp.’s 0.875% convertible notes due Feb. 15, 2022 fully exercised their $187.5 million over-allotment option on Friday, increasing the total deal size to $1,437,500,000, according to an 8-K filing with the Securities and Exchange Commission.

The company priced $1.25 billion of the convertible notes after the market close on Tuesday at the rich end of talk at par with an initial conversion premium of 32.5%, as previously reported.

Price talk had been for a coupon of 0.875% to 1.375% and an initial conversion premium of 27.5% to 32.5%, a market source said.

Barclays, Citigroup Global Markets Inc., BofA Merrill Lynch and BNP Paribas Securities Corp. are the bookrunners for the Rule 144A deal.

The notes are non-callable. They are contingently convertible until Nov. 15, 2021.

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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