Tilray partial greenshoe lifts 5% convertibles to $475 million

By Wendy Van Sickle

Columbus, Ohio, Oct. 22 – The initial purchasers for Tilray Inc.’s 5% convertible notes due Oct. 1, 2023 exercised a $25 million portion of their over-allotment option, increasing the total deal size to $475 million, according to an 8-K filing with the Securities and Exchange Commission.

The company priced an upsized $450 million of the convertibles after the market close on Oct. 4 with an initial conversion premium of 15%, as previously reported.

The deal carried a $67.5 million total over-allotment option, upsized from $60 million.

The deal, which was upsized from a planned $400 million, priced in the middle of talk for a coupon of 4.75% to 5.25% and an initial conversion premium of 12.5% to 17.5%.

Cowen and Co. LLC (lead left), BMO Capital Markets Corp. and BofA Merrill Lynch are bookrunners for the Rule 144A deal.

The notes are non-callable for three years and then are subject to a 130% hurdle. There is takeover and dividend protection.

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

Proceeds will be used to repay the $9.1 million mortgage on the company’s facility in Nanaimo, B.C., for working capital, for future acquisitions and for general corporate purposes.

Tilray is a Nanaimo, B.C.-based medical cannabis company.

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