Altair talks $200 million five-year convertible notes to yield 1.25%-1.75%, up 25%-30%

By Abigail W. Adams

Portland, Me., June 9 – Altair Engineering Inc. plans to price $200 million of five-year convertible notes after the market close on Thursday with price talk for a coupon of 1.25% to 1.75% and an initial conversion premium of 25% to 30%, according to a market source.

J.P. Morgan Securities LLC is bookrunner for the Rule 144A offering, which carries a greenshoe of $30 million.

The notes are non-callable for three years and then 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.

Altair will enter into privately negotiated transactions to repurchase a portion of its 0.25% convertible notes due 2024.

Proceeds will be used to refund the purchase of the 0.25% notes and for other corporate purposes, which may include potential acquisitions or strategic transactions and the repurchase of common stock.

Altair is a Troy, Mich.-based artificial intelligence software company.

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