By Sheri Kasprzak
New York, Jan. 24 - Sun Microsystems, Inc. secured $700 million from a private placement of two senior convertible notes.
KKR Private Equity Investors, LP, a fund of Kohlberg Kravis Roberts & Co., agreed to buy $350 million in notes due 2012 and $350 million in notes due 2014.
The notes due 2012 bear interest at 0.625% and the 2014 notes at 0.75% semi-annually. Both notes are convertible at $7.21 each.
The investor also received warrants for both sets of notes. The warrants issued with the 2012 notes are exercisable at a $9.20 each, or a 60% premium to the company's Jan. 22 closing stock price of $5.75.
The warrants issued with the 2014 notes are exercisable at a $10.0625 each, a 75% premium to the Jan. 22 closing stock price. The exact number of warrants offered in the deal could not be determined Wednesday.
The placement is scheduled to close Jan. 26.
A portion of the proceeds will be used to fund convertible note hedge transactions the company entered into concurrently with the private placement.
Sun Microsystems, based in Santa Clara, Calif., develops network computing technologies.
| Issuer: | Sun Microsystems, Inc.
|
| Issue: | Senior convertible notes
|
| Amount: | $700 million
|
| Investor: | KKR Private Equity Investors, LP
|
| Announcement date: | Jan. 23
|
| Settlement date: | Jan. 26
|
| Stock symbol: | Nasdaq: SUNW
|
| Stock price: | $5.66 at close Jan. 23, $5.75 at close Jan. 22
|
|
|
| Notes due 2012
|
| Amount: | $350 million
|
| Maturity: | 2012
|
| Coupon: | 0.625% semi-annually
|
| Conversion price: | $7.21
|
| Warrants: | Indeterminate number
|
| Warrant strike price: | $9.20
|
|
|
| Notes due 2014
|
| Amount: | $350 million
|
| Maturity: | 2014
|
| Coupon: | 0.75% semi-annually
|
| Conversion price: | $7.21
|
| Warrants: | Indeterminate number
|
| Warrant strike price: | $10.0625
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
