Jamf convertibles jump in active trade; Theravance drops; Mondelez prices exchangeables

By Rebecca Melvin

Concord, N.H., Sept. 15 – Jamf Holding Corp.’s newly priced 0.125% convertibles moved higher in active trading on Wednesday after the Minneapolis-based Apple Enterprise Management software company priced $325 million of the five-year paper with an initial conversion premium of 40%.

The bonds were quoted at 102.625 at late morning, having hit a high of 103.73 and a low print of 100.375 in the first few hours of trading. Given the stock price move, which was up a couple of points, it looked like the new bonds improved on both an outright and dollar-neutral basis, a market source said.

More than $72 million of bonds changed hands before 11 a.m. ET. At that time, the new Porch Group Inc. 0.75% convertibles, which debuted in the market on Tuesday, were the second most traded bonds, but their actively was significantly lower than Jamf’s at just $12 million of bonds having traded in the same time period, the market source noted.

PAR Technology Corp. was also in the market with a new convertible note that priced late Tuesday. It upsized its deal to $235 million from $200 million and priced it at the midpoint of coupon talk and the rich end of premium talk for a 1.5% six-year convertible note, up 37.5%.

Trading activity in the new notes was not immediately available.

Back in established bonds, the Theravance Biopharma Inc. 3.25% convertibles due 2023 gapped lower on Wednesday after news that the Cayman Islands-based biopharma company, which was founded in 2013, missed late-stage trial endpoints for ampreloxetine and is implementing significant cost cuts including slashing staff. The company shares also suffered a downgrade to “underweight” from “overweight” by JPMorgan. The investment bank cited a lack of value-creating pipeline catalysts.

The Theravance convertibles, of which $200 million priced in 2016, dropped 3.5 points outright to a price of 89.5. The underlying shares dropped nearly 16% to $6.77.

The company announced cost-cutting plans on Wednesday that it said are aimed at focusing resources on respiratory disease. Among the actions, headcount will be reduced by an estimated 270 positions, or about 75%, with most of the reduction expected to be completed in November and the remainder to be completed in February 2022.

“Given the recent results from our late-stage development programs, we have made the difficult but necessary decision to focus our resources on our most promising respiratory programs and reduce the size of the organization,” Rick E. Winningham, Theravance chairman and chief executive, said in a news release on Wednesday.

Internationally, Mondelez International Holdings Netherlands BV, a subsidiary of Mondelez International Inc., priced €300 million of zero-coupon bonds due 2024 that are exchangeable for existing ordinary shares of JDE Peet’s NV.

The guaranteed exchangeable bonds (expected rating: A3/BBB) priced at 102 for a yield to maturity of minus 0.66% and an initial exchange premium of 30%.

Pricing came at the cheap end of talk for the issue price between 102 and 103.5, yield to maturity talk of minus 1.14% to minus 0.66% and initial exchange premium talk of 30% to 35%.

The notes are non-callable until Sept. 20, 2023 and may then be redeemed in cash or exchanged for ordinary shares of JDE Peet's at a 130% price hurdle.

Proceeds are expected to be used for general corporate purposes, including funding the acquisition of Chipita SA.

Mondelez is a snack and beverage company based in Chicago and operating in about 160 countries.

JDE Peet’s is part of the Dutch beverage company Jacobs Douwe Egberts, which is partly owned by Mondelez.

Jamf jumps

The newly priced Jamf 0.125% convertibles moved up to as high as 103.73 out of the chute on Wednesday morning and were seen at late morning at 102.625. The low print was 100.375.

The underlying stock was up a couple of dollars, or about 5.5% at late morning. Later the shares retraced gains but rose again in late trading for a close at $37.90, which was up $2.19, or 6.1%.

The new Jamf convertible notes were “showing up in a big way” in trading on Wednesday, according to a market source.

The company sold $325 million of 0.125% five-year convertibles with an initial conversion premium of 40%.

Price talk was for a coupon of 0.125% to 0.625% and an initial conversion premium of 32.5% to 37.5%, according to a market source.

Barclays, J.P. Morgan Securities LLC and BofA Securities Inc. are bookrunners for the Rule 144A offering, which carries a greenshoe of $48.75 million.

If the greenshoe is not exercised, Jamf will receive $314.2 million in net proceeds.

The notes are non-callable for three-years and then subject to a 130% hurdle.

The convertibles will be settled in cash, shares or a combination of both at the company’s option.

In connection with the offering, the company will enter into capped call transactions.

The cap price of the capped call transactions will initially be $71.42 per share, representing a 100% premium over the last reported sale of Jamf’s common stock of $35.71 per share on Sept. 14.

Proceeds will be used to cover the cost of the call spread, to repay the company’s term loan facility and for general corporate purposes, which may include potential acquisitions.

Jamf Holding Corp. Nasdaq: JAMF

PAR Technology Corp. NYSE: PAR

Porch Group Inc. Nasdaq: PRCH

Theravance Biopharma Inc. Nasdaq: TBPH

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