By Abigail W. Adams
Portland, Me., March 4 – Lumentum Holdings Inc. priced $750 million of convertible notes due June 15, 2028 after the market close on Thursday at par with a coupon of 0.5% and an initial conversion premium of 32.5%, according to a company news release.
Pricing came at the midpoint of talk for a coupon of 0.375% to 0.875% and at the rich end of talk for an initial conversion premium of 27.5% to 32.5%, according to a market source.
Goldman Sachs & Co. LLC (lead left) and BofA Securities Inc. were bookrunners for the Rule 144A offering, which carries a greenshoe of $112.5 million.
The notes are non-callable until June 20, 2025 and then subject to a 130% hurdle.
There is takeover and dividend protection.
The notes will be settled in cash, shares or a combination of both at the company’s option.
Concurrently, the company will repurchase $200 million of its common stock in privately negotiated transactions.
Net proceeds are expected to be $743.2 million or will be $854.8 million if the greenshoe is exercised in full.
Proceeds will be used for the stock repurchase and for general corporate purposes.
Lumentum is a San Jose, Calif.-based designer and manufacturer of optical and photonic products.
| Issuer: | Lumentum Holdings Inc.
|
| Amount: | $750 million
|
| Greenshoe: | $112.5 million
|
| Issue: | Convertible senior notes
|
| Maturity: | June 15, 2028
|
| Bookrunners: | Goldman Sachs & Co. LLC (lead left) and BofA Securities Inc.
|
| Coupon: | 0.5%
|
| Price: | Par
|
| Yield: | 0.5%
|
| Conversion premium: | 32.5%
|
| Conversion price: | $131.03
|
| Conversion rate: | 7.6319
|
| Call options: | Non-callable until June 20, 2025 and then subject to a 130% hurdle
|
| Put options: | Upon a fundamental change
|
| Pricing date: | March 3
|
| Settlement date: | March 8
|
| Distribution: | Rule 144A
|
| Talk: | Coupon of 0.375% to 0.875% and initial conversion premium of 27.5% to 32.5%
|
| Stock symbol: | Nasdaq: LITE
|
| Stock price: | $98.89 at market close March 3
|
| Market capitalization: | $7.14 billion
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