By Rebecca Melvin
New York, Aug. 20 - SanDisk Corp. priced $1 billion seven-year convertible senior notes after the market close Thursday at par to yield 1.5% with an initial conversion premium of 25%, according to a syndicate source.
The registered deal has a greenshoe of $150 million.
The notes came at the midpoint of price talk, which was for a coupon of 1.25% to 1.75% and a premium of 22.5% to 27.5%.
Morgan Stanley & Co. Inc. and Goldman Sachs & Co. were the joint bookrunners of the offering.
The convertibles will be non-callable for life. There is contingent conversion if SanDisk's stock price exceeds 130% of the conversion price.
The company also entered into concurrent convertible note hedge and warrant transactions. The warrants' exercise price makes the effective initial conversion premium 75% from the issuer's perspective.
Proceeds will be used for general corporate purposes, including repayment of a portion of its $1.15 billion of 1% convertibles issued in 2006; for capital expenditures for new and existing manufacturing facilities; for development of new technologies; and for general working capital and non-manufacturing capital expenditures; among other things.
SanDisk is a Milpitas, Calif.-based maker of flash storage cards used in consumer electronics.
| Issuer: | SanDisk Corp.
|
| Issue: | Convertible unsecured senior notes
|
| Amount: | $1 billion
|
| Greenshoe: | $150 million
|
| Maturity: | Aug. 15, 2017
|
| Bookrunners: | Morgan Stanley & Co. Inc., Goldman Sachs & Co.
|
| Coupon: | 1.5%
|
| Price: | Par
|
| Yield: | 1.5%
|
| Conversion premium: | 25%
|
| Conversion price: | $52.37
|
| Conversion ratio: | 19.0931
|
| Call protection: | Non-callable
|
| Puts: | No puts
|
| Contingent conversion: | Yes, at 130%
|
| Takeover protection: | Yes
|
| Dividend protection: | Yes
|
| Net share settlement: | Yes
|
| Price talk: | 1.25%-1.75%, up 22.5%-27.5%
|
| Pricing date: | Aug. 19
|
| Settlement date: | Aug. 25
|
| Distribution: | Registered
|
| Stock symbol: | Nasdaq: SNDK
|
| Stock reference price: | $41.90
|
| Market capitalization: | $9.64 billion
|
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