By Abigail W. Adams
Portland, Me., Dec. 6 – Sphere Entertainment Co. priced $225 million of five-year convertible notes after the market close on Tuesday at par with a coupon of 3.5% and an initial conversion premium of 25%, according to a company news release and a market source.
Pricing came at the midpoint of talk for a coupon of 3.25% to 3.75% and the cheap end of talk for an initial conversion premium to 25% to 30%.
BofA Securities Inc. and J.P. Morgan Securities LLC were bookrunners for the Rule 144A offering, which carries a greenshoe of $33.75 million.
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 entered into capped call transactions with a cap price of $42.62, which represents a 50% premium over the last reported price of stock.
Net proceeds are expected to be $217.8 million or will be $250.4 million if the greenshoe is exercised in full.
Approximately $12.4 million will be used to cover the call spread with the remainder to be used for general corporate purposes.
Sphere Entertainment is a New York-based live entertainment and media company.
| Issuer: | Sphere Entertainment Co.
|
| Amount: | $225 million
|
| Greenshoe: | $33.75 million
|
| Issue: | Convertible senior notes
|
| Maturity: | Dec. 1, 2028
|
| Bookrunners: | BofA Securities Inc. and J.P. Morgan Securities LLC
|
| Coupon: | 3.5%
|
| Price: | Par
|
| Yield: | 3.5%
|
| Conversion premium: | 25%
|
| Conversion price: | $35.51
|
| Conversion rate: | 28.1591
|
| Pricing date: | Dec. 5
|
| Settlement date: | Dec. 8
|
| Distribution: | Rule 144A
|
| Talk: | Coupon of 3.25% to 3.75% and initial conversion premium to 25% to 30%
|
| Stock symbol: | NYSE: SPHR
|
| Stock price: | $28.41 at market close Dec. 5
|
| Market capitalization: | $997 million
|
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