By Rebecca Melvin
New York, May 13 - SBA Communications Corp. priced $500 million of five-year convertible senior notes at the cheap end of talk to yield 1.875% with an initial conversion premium of 20%, according to a company news release.
The Rule 144A notes were talked at a coupon of 1.375% to 1.875% and an initial conversion premium of 20% to 30%.
There is $50 million greenshoe.
Deutsche Bank, Citigroup and Lehman Brothers are joint bookrunners, with J.P. Morgan Securities Inc., Wachovia Securities, RBS Greenwich Capital and TD Securities acting as co-managers.
The notes are non-callable, and there are no puts. There is contingent conversion subject to a 130% hurdle.
In connection with the offering, SBA has entered into convertible note hedge transactions and it intends to use about $74 million of the proceeds from the notes plus proceeds from warrant transactions to pay for the hedge transactions.
The convertible note hedge transactions and the warrant transactions, taken as a whole, effectively increase the conversion price of the notes for the company from $41.46 per share to $67.37 per share, reflecting a premium of about 95% based on the last reported sale price of $34.55 per share of common stock on May 12.
About $120 million of proceeds will be used to repurchase about 3.27 million shares of class A common stock. And the remaining proceeds will be used to repay debt, to fund costs associated with its recently announced TowerCo acquisition, to finance future acquisitions, to repurchase shares and for general corporate purposes.
Boca Raton, Fla.-based SBA is an owner and operator of wireless communications infrastructure.
| Issuer: | SBA Communications Corp.
|
| Issue: | Convertible senior notes
|
| Amount: | $500 million
|
| Greenshoe: | $50 million
|
| Maturity: | May 1, 2013
|
| Bookrunners: | Deutsche Bank, Citigroup and Lehman Brothers
|
| Coupon: | 1.875%
|
| Price: | Par
|
| Yield: | 1.875%
|
| Conversion premium: | 20%
|
| Conversion price: | $41.46
|
| Conversion ratio: | 24.1196
|
| Calls: | Non-callable
|
| Puts: | No puts
|
| Contingent conversion: | Yes, subject to a 130% hurdle
|
| Pricing date: | May 12
|
| Settlement date: | May 16
|
| Distribution: | Rule 144A with registration rights
|
| Price talk: | 1.375%-1.875% coupon, up 20%-30%
|
| Stock symbol: | Nasdaq: SBAC
|
| Stock price: | $34.55 at close May 12
|
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