Nutanix talks $400 million five-year convertible notes to yield 0% to 0.5%, up 25% to 30%

By Abigail W. Adams

Portland, Me., Jan. 16 – Nutanix Inc. plans to price $400 million in five-year convertible notes after the market close on Wednesday with price talk for a coupon of 0% to 0.5% and an initial conversion premium of 25% to 30%, according to a market source.

Bank of America Merrill Lynch and Morgan Stanley are bookrunners for the deal, which carries a greenshoe of $60 million, according to a company release.

The notes are five-year bullets with no calls or puts, a market source said.

In connection with the pricing, Nutanix will enter into convertible note hedge and warrant transactions with the initial purchasers and their option counterparties.

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

Nutanix is a San Jose, Calif-based cloud computing software company.

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