Vishay greenshoe exercise lifts 2.25% convertibles to $750 million

By Marisa Wong

Los Angeles, Sept. 12 – The initial purchasers of Vishay Intertechnology Inc.’s offering of 2.25% senior convertible notes due 2030 exercised their $100 million over-allotment option in full, bringing the total issue size to $750 million, according to an 8-K filing with the Securities and Exchange Commission.

Vishay priced an upsized $650 million of the seven-year convertible notes after the market close on Thursday at par with a coupon of 2.25% and an initial conversion premium of 20%, as previously reported.

Pricing came in line with talk for a fixed coupon of 2.25% and at the cheap end of talk for an initial conversion premium of 20% to 25%, according to a market source.

J.P. Morgan Securities LLC was the bookrunner for the Rule 144A offering.

The initial size of the offering was $600 million with a greenshoe of $90 million.

The notes are non-callable until Sept. 20, 2027 and then subject to a 130% hurdle.

They are putable upon a fundamental change.

The notes will be settled in cash up to the principal amount with any remaining amounts to be settled in cash, shares or a combination of both.

In connection with the offering, the company entered into capped call transactions with a cap price of $43.98, which represents a 75% premium over the last reported price of stock.

The company used $388.8 million of net proceeds to repurchase $370.2 million principal amount of its 2.25% convertible notes due 2025.

Proceeds were also used to cover the cost of the call spread and to repay borrowings under the company’s senior secured credit facility.

Any remaining proceeds will be used for general corporate purposes.

Vishay is a Malvern, Pa.-based semiconductor manufacturer.

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