Vroom greenshoe increases 0.75% convertibles to $625 million

By Wendy Van Sickle

Columbus, Ohio, June 21 – Underwriters for Vroom Inc.’s 0.75% five-year convertible notes fully exercised their $75 million greenshoe, increasing the total deal size to $625 million, according to an 8-K filing with the Securities and Exchange Commission.

The company priced an upsized $550 million of the notes after the market close on June 15 at par at the rich end of talk with a coupon of 0.75% and an initial conversion premium of 40%.

Price talk was for a coupon of 0.75% to 1.25% and an initial conversion premium of 35% to 40%, according to a market source.

The initial size of the offering was $500 million.

Goldman Sachs & Co. LLC, BofA Securities Inc., Wells Fargo Securities LLC and Allen & Co. LLC are joint bookrunners for the Rule 144A offering.

The notes are non-callable until July 6, 2024 and then subject to a 130% hurdle.

They are putable upon a fundamental change. There is dividend protection.

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

Net proceeds will be $608.9 million with the greenshoe exercised.

Proceeds will be used for general corporate purposes, which may include acquisitions or investments.

Vroom is a New York-based e-commerce platform for used vehicles.

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