Confluent talks $1 billion five-year convertible notes to yield 0%-0.5%, up 37.5%-42.5%

By Abigail W. Adams

Portland, Me., Dec. 8 – Confluent Inc. plans to price $1 billion of five-year convertible notes after the market close on Wednesday with price talk for a coupon of 0% to 0.5% and an initial conversion premium of 37.5% to 42.5%, according to a market source.

Morgan Stanley & Co. LLC (lead left), J.P. Morgan Securities LLC, Goldman Sachs & Co. LLC, BofA Securities Inc. and Citigroup Global Markets Inc. are bookrunners for the Rule 144A offering, which carries a greenshoe of $100 million.

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

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 and for general corporate purposes, which may include acquisitions or strategic investments.

Confluent is a Mountain View, Calif.-based data streaming platform.

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