Winnebago greenshoe lifts 3.25% convertible notes to $350 million

By Marisa Wong

Los Angeles, Jan. 23 – The initial purchasers of Winnebago Industries Inc.’s recently priced 3.25% six-year convertible senior notes exercised their $50 million over-allotment option in full, lifting the size of the issue to $350 million, according to an 8-K filing with the Securities and Exchange Commission.

Winnebago priced the initial $300 million of notes with a conversion premium of 30% after the market close on Thursday, as previously reported.

Price talk was for a coupon of 3% to 3.5% and an initial conversion premium of 27.5% to 32.5%, according to a market source.

Goldman Sachs & Co. LLC and BMO Capital Markets Corp. were bookrunners for the Rule 144A offering.

The notes are freely convertible beginning July 15, 2029.

The notes are non-callable until Jan. 15, 2028 and then subject to a 130% hurdle.

They are putable upon a fundamental change.

The notes will be settled in cash up to the principal amount with 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 entered into convertible note hedge and warrant transactions.

Proceeds will be used to cover the cost of the hedge transactions, to repurchase $241 million of the company’s outstanding 1.5% convertible notes due 2025 in privately negotiated transactions and for general corporate purposes.

Winnebago is an Eden Prairie, Minn.-based RV manufacturer.

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