By Abigail W. Adams
Portland, Me., May 29 – Cerence Inc. priced $150 million of long five-year convertible notes after the market close on Thursday at par at the midpoint of talk with a coupon of 3% and an initial conversion premium of 35%, according to a company news release.
Price talk was for a coupon of 2.75% to 3.25% and an initial conversion premium of 32.5% to 37.5%, according to a market source.
Wells Fargo Securities LLC (lead left) and Evercore were bookrunners for the Rule 144A offering, which carries a greenshoe of $25 million.
The notes are contingently convertible until March 1, 2025. They are non-callable until June 5, 2023 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.
Net proceeds are expected to be $144.8 million, or $169.1 million if the greenshoe is exercised in full.
Proceeds will be used to repay borrowings under the company’s senior secured term loan credit facility.
Cerence is a Burlington, Mass.-based voice recognition technology company serving the automotive industry.
| Issuer: | Cerence Inc.
|
| Securities: | Convertible senior notes
|
| Amount: | $150 million
|
| Greenshoe: | $25 million
|
| Maturity: | Dec. 1, 2025
|
| Bookrunners: | Wells Fargo Securities LLC (lead left) and Evercore
|
| Coupon: | 3%
|
| Price: | Par
|
| Yield: | 3%
|
| Conversion premium: | 35%
|
| Conversion price: | $37.42
|
| Conversion rate: | 26.7271
|
| Call options: | Non-callable until June 5, 2023 and then subject to a 130% hurdle
|
| Put options: | Upon a fundamental change
|
| Pricing date: | May 28
|
| Settlement date: | June 2
|
| Distribution: | Rule 144A
|
| Talk: | Coupon of 2.75% to 3.25% and initial conversion premium of 32.5% to 37.5%
|
| Stock symbol: | Nasdaq: CRNC
|
| Stock price: | $27.715 at market close May 29
|
| Market capitalization: | $1.01 billion
|
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