HubSpot to price $300 million five-year convertible notes at 0.5%-1% yield, up 30%-35%

By Stephanie N. Rotondo

Seattle, May 3 – HubSpot Inc. announced a $300 million offering of five-year convertible senior notes in a press release on Wednesday.

The Rule 144A deal is being talked at a 0.5% to 1% yield and an initial conversion premium of 30% to 35%, a market source reported.

BofA Merrill Lynch, Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC are the joint bookrunners.

There is a $50 million greenshoe.

The convertible debt is non-callable for life. The paper is contingently convertible if the stock hits a 130% price hurdle.

Conversions will be settled in cash, stock or a combination.

In connection with the offering, HubSpot expects to enter into privately negotiated convertible note hedge transactions with one or more initial purchasers of the notes and/or their affiliates.

A portion of the deal’s proceeds will be used to fund the hedging transactions. The remaining funds will be used for general corporate purposes.

HubSpot is a Cambridge, Mass.-based inbound marketing and sales platform.

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