Varonis Systems talks $175 million five-year convertibles to yield 1%-1.5%, up 27.5%-32.5%

By Abigail W. Adams

Portland, Me., May 6 – Varonis Systems Inc. plans to price $175 million convertible notes due Aug. 15, 2025 after the market close on Wednesday with price talk for a coupon of 1% to 1.5% and an initial conversion premium of 27.5% to 32.5%, according to a market source.

J.P. Morgan Securities LLC and Barclays are the active bookrunners for the Rule 144A offering, which carries a greenshoe of $26.25 million.

The notes are non-callable until Aug. 20, 2023 and then subject to a 130% hurdle.

There is standard dividend and takeover protection.

In connection with the pricing of the notes the company will enter into capped call transactions.

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

Varonis Systems is a New York-based data security and analytics company.

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