By Abigail W. Adams
Portland, Me., April 29 – CNX Resources Corp. priced $300 million of six-year convertible notes after the market close on Tuesday at par with a coupon of 2.25% and an initial conversion premium of 20%, according to a market source.
Pricing came at the rich end of talk for a coupon of 2.25% to 2.75% and the midpoint of talk for an initial conversion premium of 17.5% to 22.5%.
J.P. Morgan Securities LLC and Credit Suisse Securities (USA) LLC were active bookrunners for the Rule 144A offering, which carries a greenshoe of $45 million.
BofA Securities Inc., SunTrust Robinson Humphrey Inc. and Wells Fargo Securities LLC were also bookrunners.
The notes are non-callable until Nov. 1, 2023 and then subject to a 130% hurdle.
They are contingently convertible until Feb. 1, 2026.
The notes are putable upon a fundamental change.
There is standard dividend protection.
The notes will be settled in cash, shares, or a combination of both at the company’s option.
In connection with the pricing of the notes, the company entered into capped call transactions with a cap price of $18.19, representing a 70% premium over the last reported sales price of stock.
Net proceeds are expected to be $290.2 million or $333.9 million if the greenshoe is exercised in full.
Proceeds will be used to cover the cost of the call spread and for general corporate purposes, which may include the repayment of debt.
CNX Resources is a Pittsburgh-based natural gas company.
| Issuer: | CNX Resources Corp.
|
| Securities: | Convertible senior notes
|
| Amount: | $300 million
|
| Greenshoe: | $45 million
|
| Maturity: | May 1, 2026
|
| Bookrunners: | J.P. Morgan Securities LLC, Credit Suisse Securities (USA) LLC, BofA Securities Inc., SunTrust Robinson Humphrey Inc. and Wells Fargo Securities LLC
|
| Coupon: | 2.25%
|
| Price: | Par
|
| Yield: | 2.25%
|
| Conversion premium: | 20%
|
| Conversion price: | $12.84
|
| Conversion rate: | 77.8816
|
| Call options: | Non-callable until Nov. 1, 2023 and then subject to a 130% hurdle
|
| Put options: | Upon a fundamental change
|
| Pricing date: | April 28
|
| Settlement date: | May 1
|
| Distribution: | Rule 144A
|
| Talk: | Coupon of 2.25% to 2.75% and initial conversion premium of 17.5% to 22.5%
|
| Stock symbol: | NYSE: CNX
|
| Stock price: | $10.70 at market close April 28
|
| Market capitalization: | $2 billion
|
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