By Abigail W. Adams
Portland, Me., Feb. 21 – Global Payments Inc. priced $1.75 billion of seven-year convertible notes (Baa3/BBB-/BBB) after the market close on Tuesday at par with a coupon of 1.5% and an initial conversion premium of 20%, according to a company news release.
Pricing came at the rich end of talk for a coupon of 1.5% to 2% and at the midpoint of talk for an initial conversion premium of 17.5% to 22.5%, according to a market source.
BofA Securities Inc. and J.P. Morgan Securities LLC were bookrunners for the Rule 144A offering, which carries a greenshoe of $250 million.
HudsonWest LLC acted as financial adviser to the company.
The notes are non-callable until March 6, 2028 and are then subject to a 130% hurdle.
They are putable upon a fundamental change.
There is dividend protection above 25 cents per quarter.
The notes 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 entered into capped call transactions with a cap price of $228.90, which represents a premium of 75% over the last reported price of stock.
Net proceeds are expected to be $1.72 billion or will be $1.96 billion if the greenshoe is exercised in full.
Approximately $222.25 million of net proceeds will be used to cover the cost of the call spread and $185.10 million of net proceeds will be used to repurchase shares of common stock in privately negotiated transactions with the initial purchasers of the notes.
Remaining amounts will be used to repay borrowings under the company’s commercial paper program and its revolving credit agreement and for general corporate purposes, which may include the repayment of other debt.
Global Payments is an Atlanta-based payments technology company.
| Issuer: | Global Payments Inc.
|
| Amount: | $1.75 billion
|
| Greenshoe: | $250 million
|
| Issue: | Convertible senior notes
|
| Maturity: | March 1, 2031
|
| Bookrunners: | BofA Securities Inc. and J.P. Morgan Securities LLC
|
| Financial adviser: | HudsonWest LLC
|
| Coupon: | 1.5%
|
| Price: | Par
|
| Yield: | 1.5%
|
| Conversion premium: | 20%
|
| Conversion price: | $156.96
|
| Conversion rate: | 6.3710
|
| Call options: | Non-callable until March 6, 2028 and then subject to a 130% hurdle
|
| Put options: | Upon a fundamental change
|
| Pricing date: | Feb. 20
|
| Settlement date: | Feb. 23
|
| Ratings: | Moody’s: Baa3
|
| S&P: BBB-
|
| Fitch: BBB
|
| Distribution: | Rule 144A
|
| Talk: | Coupon of 1.5% to 2% and initial conversion premium of 17.5% to 22.5%
|
| Stock symbol: | NYSE: GPN
|
| Stock price: | $130.80 at market close Feb. 20
|
| Market capitalization: | $33.74 billion
|
|
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
