Scorpio Bulkers greenshoe ups 7.5% five-year notes to $73.63 million

By Susanna Moon

Chicago, Oct. 16 – Scorpio Bulkers Inc. said underwriters exercised the over-allotment option for another $8,625,000 of 7.5% five-year senior notes, bringing the total deal size to $73,625,000.

As previously announced, the company priced $65 million of the notes at par of $25.00 on Sept. 15, which was at the tight end of 7.5% to 7.625% price talk.

The company launched the deal on Sept. 15 after announcing plans to sell the notes on Aug. 7. The next day, the company said it had upsized the deal to $60 million from $35 million.

Stifel Nicolaus & Co. Inc., Deutsche Bank Securities Inc. and Jefferies LLC were the bookrunners.

The notes can be redeemed beginning Sept. 15, 2016 or upon a taxation change at par plus accrued interest. Holders can require the company to repurchase the notes at 101% of par plus accrued interest upon a change of control.

Under the covenants of the note indenture, the company’s net borrowings cannot equal or exceed 70% of its total assets, and it must keep its tangible net worth above $500 million.

The Monaco-based shipping company plans to use the proceeds to fund installment payments due under its newbuilding program. Any remaining proceeds will be used for general corporate purposes and working capital.

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