By Abigail W. Adams
Portland, Me., March 3 – Innoviva Inc. priced an upsized $225 million of six-year convertible notes after the market close on Wednesday at par at the rich end of talk with a coupon of 2.125% and an initial conversion premium of 35%, according to a company news release and a market source.
Price talk was for a coupon of 2.125% to 2.625% and an initial conversion premium of 30% to 35%.
Goldman Sachs & Co. LLC and Moelis & Co. are bookrunners for the Rule 144A offering, which carries an upsized greenshoe of $45 million.
The initial size of the offering was $200 million with a greenshoe of $40 million.
The notes are non-callable until March 20, 2025 and then subject to a 130% hurdle.
They are putable upon a fundamental change. There is dividend protection.
Concurrently with the offering, the company will repurchase $144.8 million of its 2.125% convertible notes due 2023 for $165.6 million in privately negotiated transactions.
In connection with the offering, the company entered into capped call transactions with a cap price of $33.9850, representing a 75% premium over the last reported price of stock.
Net proceeds are expected to be $216.8 million or will be $260.5 million if the greenshoe is exercised in full.
Approximately $18.1 million will be used to cover the cost of the call spread and $144.8 million will be used to repurchase the 2023 notes with any remaining proceeds to be used for general corporate purposes.
Innoviva is a Burlingame, Calif.-based biopharmaceutical company.
| Issuer: | Innoviva Inc.
|
| Amount: | $225 million
|
| Greenshoe: | $45 million
|
| Issue: | Convertible senior notes
|
| Maturity: | March 15, 2028
|
| Bookrunners: | Goldman Sachs & Co. LLC and Moelis & Co.
|
| Coupon: | 2.125%
|
| Price: | Par
|
| Yield: | 2.125%
|
| Conversion premium: | 35%
|
| Conversion price: | $26.22
|
| Conversion rate: | 38.1432
|
| Call options: | Non-callable until March 20, 2025 and then subject to a 130% hurdle
|
| Put options: | Upon a fundamental change
|
| Pricing date: | March 2
|
| Settlement date: | March 7
|
| Distribution: | Rule 144A
|
| Talk: | Coupon of 2.125% to 2.625% and initial conversion premium of 30% to 35%
|
| Stock symbol: | Nasdaq: INVA
|
| Stock price: | $19.42 at market close March 2
|
| Market capitalization: | $1.35 billion
|
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