Ocado talks £350 million seven-year convertibles to yield 0.5%-1%, up 30%-35%

By Abigail W. Adams

Portland, Me., June 10 – Ocado Group plc plans to price £350 million of seven-year convertible bonds with price talk for a coupon of 0.5% to 1% and an initial conversion premium of 30% to 35%, according to a company news release.

Goldman Sachs International and J.P. Morgan Cazenove are joint global coordinators and bookrunners for the offering, which will be placed via an accelerated bookbuilding process with institutional investors.

The convertible notes are non-callable until Feb. 8, 2025 and then subject to a 130% hurdle.

The notes are also subject to a clean-up call if more than 85% of the principal has been converted or repurchased.

The bookrunners will organize a “delta placement” of ordinary shares to facilitate the hedging activities of certain subscribers to the notes.

Concurrently with the convertible bond offering, the company will place £650 million of ordinary shares.

Proceeds from the concurrent offerings will be used to support the company’s partners, to fund new partners, to increase investment in its technology and to expand its leadership position.

Ocado Group is a Hatfield, U.K.-based online grocery platform and solutions provider.

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