RealReal talks $250 million seven-year convertible notes to yield 0.5%-1%, up 32.5%-37.5%

By Abigail W. Adams

Portland, Me., March 2 – The RealReal Inc. plans to price $250 million of seven-year convertible notes after the market close on Wednesday with price talk for a coupon of 0.5% to 1% and an initial conversion premium of 32.5% to 37.5%, according to a market source.

Credit Suisse Securities (USA) LLC and BofA Securities Inc. are joint bookrunners for the Rule 144A offering, which carries a greenshoe of $37.5 million.

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

They will be settled in cash, shares or a combination of both at the company’s option.

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 and for general corporate purposes.

The RealReal is a San Francisco-based online and brick-and-mortar luxury consignment marketplace.

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