Porch Group talks $350 million five-year convertible notes to yield 0.5%-1%, up 30%-35%

By Abigail W. Adams

Portland, Me., Sept. 13 – Porch Group Inc. plans to price $350 million of five-year convertible notes after the market close on Monday with price talk for a coupon of 0.5% to 1% and an initial conversion premium of 30% to 35%, according to a market source.

Goldman Sachs & Co. LLC (lead left), J.P. Morgan Securities LLC and Oppenheimer & Co. Inc. are bookrunners for the Rule 144A offering, which carries a greenshoe of $52.5 million.

The notes are non-callable until Sept. 20, 2024 and then subject to a 130% hurdle.

There is dividend and takeover protection.

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

In connection with the offering, the company will enter into capped call transactions.

Proceeds will be used to cover the cost of the call spread, repay outstanding borrowings under the company’s senior secured term loan and for general corporate purposes, which may include potential acquisitions.

Porch Group is a Seattle-based software company serving home services professionals.

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