Merit Medical tightens talk on $550 million five-year convertibles to 3%-3.25%, up 32.5%

By Abigail W. Adams

Portland, Me., Dec. 5 – Merit Medical Systems Inc. tightened talk on its $550 million offering of five-year convertible notes to a coupon of 3% to 3.25% and an initial conversion premium of 32.5%, according to a market source.

Price talk was initially for a coupon of 3.5% to 4% and an initial conversion premium of 27.5% to 32.5%, according to a market source.

The deal was slated to price after the market close on Tuesday.

J.P. Morgan Securities LLC (lead left), Piper Sandler Co. and Wells Fargo Securities LLC are bookrunners for the Rule 144A offering, which carries a greenshoe of $82.5 million.

The notes are non-callable for three years and then subject to a 130% hurdle.

There is takeover and dividend protection.

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 at the company’s option.

In connection with the offering, the company will enter into capped call transactions.

Proceeds will be used to cover the cost of the call spread and for general corporate purposes, which may include the repayment or reduction of debt or investments in and acquisitions of other companies, products or technologies.

Merit Medical is a South Jordan, Utah-based medical device manufacturer.

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