Micron greenshoe exercised in full, lifts convertibles to $690 million

By Devika Patel

Knoxville, Tenn., July 26 - Underwriters for Micron Technology Inc.'s offering of 1.5% and 1.875% 20-year convertible senior notes exercised their over-allotment option in full for $90 million more of the convertibles, increasing the size of the issue to $690 million, according to an 8-K filed Tuesday with the Securities and Exchange Commission.

As previously reported, the company sold the convertibles at par on July 20 in a Rule 144A offering via bookrunner Morgan Stanley & Co. LLC and joint lead manager Lazard Capital Markets LLC. The co-managers were Goldman Sachs & Co., Bank of America Merrill Lynch, HSBC Securities (USA) Inc. and U.S. Bancorp Investments Inc.

The company sold $300 million of the 1.5% convertibles and $300 million of the 1.875% convertibles. Each tranche had a $45 million greenshoe.

The convertibles have a conversion premium of 25% and an initial conversion price of $9.50, which equals a conversion ratio of 105.2632.

The bonds have net share settlement and standard takeover protection via a make-whole grid and dividend protection.

The 1.5% convertibles are non-callable for two years and putable on Aug. 1, 2018. The 1.875% convertibles are non-callable for three years and putable on Aug. 1, 2020.

Proceeds are earmarked for repurchasing common stock under a $150 million stock repurchase program and for general corporate purposes, including working capital, capital expenditures and potential acquisitions and strategic transactions, and to cover the expense of a capped-call spread.

Micron is a Boise, Idaho-based maker of semiconductor devices.

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