Okta talks $300 million in five-year convertibles to yield 0.25% to 0.75%, up 27.5% to 32.5%

By Abigail W. Adams

Portland, Me., Feb. 21 – Okta Inc. plans to price $300 million of five-year convertible notes after the market close on Thursday with price talk for a coupon of 0.25% to 0.75% and an initial conversion premium of 27.5% to 32.5%, according to a market source.

Goldman Sachs, Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC are joint bookrunners for the Rule 144A deal, which carries a greenshoe of $45 million.

The notes are non-callable and there are no investor puts.

There is standard dividend and takeover protection.

The notes will be settled in cash, shares or a combination of both at the company’s option.

In connection with the pricing, Okta will enter into convertible note hedge transactions that will cover the number of shares underlying the convertible notes, according to a company release.

Okta will also sell warrants for the purchase of up to the same number of shares of common stock.

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

Okta is a San Francisco-based enterprise identity provider. The Okta Identity Cloud connects enterprises with their employees, partners, and customers.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.