Innoviva greenshoe lifts 2.5% convertibles due 2025 to $192.5 million

By Wendy Van Sickle

Columbus, Ohio, Aug. 7 – Underwriters for Innoviva Inc.’s 2.5% convertible senior notes due 2025 fully exercised their $17.5 million over-allotment option on Monday, lifting the total deal size to $192.5 million, according to an 8-K filing with the Securities and Exchange Commission.

As previously reported, the company priced $175 million of the notes at par on Aug. 2 with an initial conversion premium of 30%.

The Rule 144A deal came in the middle of the 2.25% to 2.75% yield talk, as well in the middle of the 27.5% to 32.5% premium talk.

Morgan Stanley & Co. LLC and Deutsche Bank Securities Inc. are the bookrunners.

Conversion will be settled in cash, common stock or a combination of the two. The bonds are convertible into 57.9240 common shares per each $1,000 of notes, equal to an initial conversion price of $17.26.

Prior to Feb. 15, 2025, the notes are convertible only in certain circumstances. After that date, the debt can be converted at any time.

The convertibles are non-callable for life.

The transaction was part of the company’s plan to refinance its 9% fixed-rate term notes due 2029. Proceeds from the convertibles offering will be used to redeem a portion of the issue on Aug. 15.

The company will also use the funds to purchase $17.5 million of common stock via privately negotiated transactions.

Innoviva is a Brisbane, Calif.-based biopharmaceutical company.

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