By Abigail W. Adams
Portland, Me., March 16 – Freshpet Inc. priced $350 million of five-year convertible notes after the market close on Wednesday at par at the cheap end of talk with a coupon of 3% and an initial conversion premium of 27.5%, according to a company news release and a market source.
Price talk was for a coupon of 2.5% to 3% and an initial conversion premium of 27.5% to 32.5%.
BofA Securities Inc. and Goldman Sachs & Co. LLC were bookrunners for the Rule 144A offering, which carries a greenshoe of $52.5 million.
The notes are non-callable until April 3, 2026 and then subject to a 130% hurdle.
They are putable upon a fundamental change.
In connection with the offering, the company entered into capped call transactions with a cap price of $120.23, which represents a premium of 120% over the last reported price of the company’s stock.
Net proceeds are expected to be $340.3 million or will be $391.4 million assuming the full exercise of the greenshoe.
Approximately $57.6 million of net proceeds will be used to cover the cost of the call spread and for general corporate purposes.
Freshpet is a Secaucus, N.J.-based pet food company.
| Issuer: | Freshpet Inc.
|
| Amount: | $350 million
|
| Greenshoe: | $52.5 million
|
| Issue: | Convertible senior notes
|
| Maturity: | April 1, 2028
|
| Bookrunners: | BofA Securities Inc. and Goldman Sachs & Co. LLC
|
| Coupon: | 3%
|
| Price: | Par
|
| Yield: | 3%
|
| Conversion premium: | 27.5%
|
| Conversion price: | $69.68
|
| Conversion rate: | 14.3516
|
| Call options: | Non-callable until April 3, 2026 and then subject to a 130% hurdle
|
| Put options: | Upon a fundamental change
|
| Pricing date: | March 15
|
| Settlement date: | March 20
|
| Distribution: | Rule 144A
|
| Talk: | Coupon of 2.5% to 3% and initial conversion premium of 27.5% to 32.5%
|
| Stock symbol: | Nasdaq: FRPT
|
| Stock price: | $54.65 at market close March 15
|
| Market capitalization: | $2.63 billion
|
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