Wayfair talks $500 million six-year convertible notes to yield 0.625%-1.125%, up 32.5%-37.5%

By Abigail W. Adams

Portland, Me., Nov. 14 – Wayfair Inc. plans to price $500 million six-year convertible notes after the market close on Wednesday with price talk for a coupon of 0.625% to 1.125% and an initial conversion premium of 32.5% to 37.5%, according to a market source.

Citigroup Global Markets Inc. and Goldman Sachs & Co. LLC are joint bookrunners for the Rule 144A deal.

The notes are contingently convertible until Aug. 1, 2024 subject to a 130% hurdle. They are non-callable until May 8, 2022 and then subject to a 130% hurdle.

The notes may be settled in cash, shares or a combination of both at the company’s option. There is dividend and takeover protection.

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

Proceeds will be used to cover the cost of the call spread, for working capital and for general corporate purposes.

Wayfair is a Boston-based e-commerce company focused on home décor.

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