World Kinect talks $250 million five-year convertible notes to yield 3%-3.5%, up 25%-30%

By Abigail W. Adams

Portland, Me., June 21 – World Kinect Corp. plans to price $250 million of five-year convertible notes after the market close on Wednesday with price talk for a coupon of 3% to 3.5% and an initial conversion premium of 25% to 30%, according to a market source.

Morgan Stanley & Co. LLC (lead left), J.P. Morgan Securities LLC, BofA Securities Inc. and Raymond James & Associates are bookrunners for the Rule 144A offering, which carries a greenshoe of $37.5 million.

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

They will be settled in cash up to the principal amount with remaining amounts to 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 convertible note hedge and warrant transactions.

Proceeds will be used to cover the cost of the hedge transactions, for the repayment of a portion of outstanding amounts under its revolving credit facility, to repurchase $50 million in common stock from the purchasers of the notes and for general corporate purposes.

World Kinect is a Miami-based global energy management company.

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