Nevro talks $165 million five-year convertibles to yield 2.75%-3.25%, up 22.5%-27.5%

By Abigail W. Adams

Portland, Me., April 1 – Nevro Corp. plans to price $165 million of five-year convertible notes prior to the market open on Thursday with price talk for a coupon of 2.75% to 3.25% and an initial conversion premium of 22.5% to 27.5%, according to a market source.

Morgan Stanley & Co. LLC is the bookrunner for the registered offering, which carries a greenshoe of $24.75 million.

The notes are non-callable. They are putable upon a fundamental change.

The notes are contingently convertible until Oct. 1, 2024.

In connection with the pricing of the notes, the company will enter into convertible note hedge and warrant transactions.

The company is also pricing a secondary offering of 1,625,000 shares of common stock.

Proceeds will be used to cover the cost of the hedge transactions, to repurchase and retire its outstanding 1.75% convertible notes due 2021 in privately negotiated transactions, and for general corporate purposes.

Nevro is a Redwood City, Calif.-based global medical device company.

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