By Rebecca Melvin
New York, Sept. 5 – Okta Inc. priced $1 billion of 0.125% six-year convertible notes after the market close on Wednesday at par with an initial conversion premium of 47.5%, according to a market source.
Pricing of the deal came toward the rich end for the coupon talked at 0% to 0.5% and at the rich end for the premium, which was talked at 42.5% to 47.5%.
Goldman Sachs & Co. LLC, Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC were bookrunners for the Rule 144A deal, which has a $150 million greenshoe.
The notes are non-callable for three years and are provisionally callable thereafter at a price hurdle of 130%. There are no investor puts, and there is standard dividend and takeover protection.
In connection with the pricing, Okta entered into new capped call transactions. The proceeds will cover these costs as well as the repurchase of Okta’s existing 2023 notes 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.
| Issuer: | Okta Inc.
|
| Securities: | Convertible senior notes
|
| Amount: | $1 billion
|
| Greenshoe: | $150 million
|
| Maturity: | Six years
|
| Bookrunners: | Goldman Sachs & Co. LLC, Morgan Stanley & Co. LLC and J.P. Morgan Securities LLC
|
| Coupon: | 0.125%
|
| Price: | Par
|
| Yield: | 0.125%
|
| Conversion premium: | 47.5%
|
| Call options: | Non-callable for three years, then subject to a 130% hurdle
|
| Capped call: | Yes
|
| Pricing date: | Sept. 4
|
| Price talk: | 0%-0.5%, up 42.5%-47.5%
|
| Stock symbol: | Nasdaq: OKTA
|
| Stock reference price: | $127.94, as of close on Sept. 4
|
| Market capitalization: | $14.21 billion
|
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