Ribbon Communications talks $150 million five-year convertibles at 2.25%-2.75%, up 27.5%-32.5%

By Abigail W. Adams

Portland, Me., Nov. 13 – Ribbon Communications Inc. plans to price $150 million of five-year convertible notes after the market close on Tuesday with price talk for a coupon of 2.25% to 2.75% and an initial conversion premium of 27.5% to 32.5%, according to a market source.

J.P. Morgan Securities LLC and Jefferies LLC are bookrunners for the Rule 144A offering, which carries a greenshoe of $25 million.

The notes are contingently convertible until Feb. 15, 2023. They are non-callable. There are no puts except upon the occurrence of a fundamental change.

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

The notes will be guaranteed by subsidiaries Sonus Networks, Inc. and Genband US LLC.

In connection with the pricing, the company will enter into convertible note hedge and warrant transactions.

Proceeds will be used to cover the cost of the call spread, to repay a promissory note to certain stockholders, to repay the outstanding amounts under its secured credit facility and for general corporate purposes.

Ribbon Communications is a Westford, Mass.-based security and software solutions company.

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