Bill.com tightens talk on $500 million six-year convertible notes to yield 0%, up 52.5%-55%

By Abigail W. Adams

Portland, Me., Sept. 21 – Bill.com Holdings Inc. tightened talk on its $500 million offering of six-year convertible notes to a fixed coupon of 0% and an initial conversion premium of 52.5% to 55%, according to a market source.

Initial price talk was for a coupon of 0% to 0.25% and an initial conversion premium of 45% to 50%.

Goldman Sachs & Co. LLC, BofA Securities, Inc, J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC are bookrunners for the Rule 144A offering, which carries a greenshoe of $75 million.

The notes are non-callable until Oct. 5, 2024 and then subject to a 130% hurdle.

They are putable upon a fundamental change.

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

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

Concurrently, the company plans to sell $1 billion of common stock in a registered offering. The secondary offering carries a greenshoe of $150 million.

Proceeds will be used to cover the cost of the call spread and for general corporate purposes, which may include potential acquisitions or strategic transactions.

Bill.com is a Palo Alto, Calif.-based cloud-based software company that automates financial operations for small and mid-size businesses.

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