By Angela McDaniels
Tacoma, Wash., Sept. 7 – Insulet Corp. priced an upsized $300 million of 1.25% five-year convertible senior notes at par on Wednesday with an initial conversion premium of 32.5%, according to a company news release.
The Rule 144A deal was initially talked at $250 million. Pricing came at the rich end of talk that was for a 1.25% to 1.75% coupon and a 27.5% to 32.5% premium.
The greenshoe was upsized to $45 million from $37.5 million.
The joint bookrunners were Morgan Stanley & Co. LLC and Wells Fargo Securities LLC.
The notes are non-callable for three years and then provisionally callable if shares exceed 130% of the conversion price. There are no puts.
The securities have contingent conversion with a 130% share price threshold and net share settlement.
There is dividend protection for any dividends paid and takeover protection via a standard make-whole matrix.
The company plans to use about $154 million of the proceeds to repurchase about $134 million of its 2% convertible senior notes due 2019. The remaining proceeds will be used for general corporate purposes, which may include buying back more of Insulet’s remaining 2% convertibles, as well as investment in its manufacturing and supply chain operations.
Insulet is a Bedford, Mass.-based medical device maker.
Rebecca Melvin contributed to this story
| Issuer: | Insulet Corp.
|
| Issue: | Convertible senior notes
|
| Amount: | $300 million, upsized from $250 million
|
| Greenshoe: | $45 million, upsized from $37.5 million
|
| Maturity: | Sept. 15, 2021
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| Bookrunners: | Morgan Stanley & Co. LLC, Wells Fargo Securities LLC
|
| Coupon: | 1.25%
|
| Price: | Par
|
| Yield: | 1.25%
|
| Conversion premium: | 32.5%
|
| Conversion price: | $58.37
|
| Conversion ratio: 17.1332 shares
|
| Calls: | Non-callable for three years, then provisionally callable at 130% price hurdle
|
| Puts: | No puts
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| Contingent conversion: | Yes
|
| Net share settlement: | Yes
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| Dividend protection: | Yes
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| Takeover protection: | Yes, standard make-whole
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| Price talk: | 1.25%-1.75%, up 27.5%-32.5%
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| Pricing date: | Sept. 7
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| Settlement date: | Sept. 13
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| Distribution: | Rule 144A
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| Stock symbol: | Nasdaq: PODD
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| Stock reference price: | $44.05 as of close Sept. 7
|
| Market capitalization: | $2.52 billion
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