Redfin talks $500 million six-year convertible notes to yield 0%-0.5%, up 35%-40%

By Abigail W. Adams

Portland, Me., March 22 – Redfin Corp. plans to price $500 million of six-year convertible notes after the market close on Monday with price talk for a coupon of 0% to 0.5% and an initial conversion premium of 35% to 40%, according to a market source.

Goldman Sachs & Co. LLC and BofA Securities Inc. are joint bookrunners for the Rule 144A offering, which carries a greenshoe of $75 million.

The notes are non-callable for three years and then subject to a 130% hurdle.

There is 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 offering, the company will enter into capped call transactions.

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

Redfin is a Seattle-based technology-powered real estate company.

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