By Abigail W. Adams
Portland, Me., May 27 – 1Life Healthcare Inc. priced an upsized $275 million of five-year convertible notes after the market close on Tuesday at par with a coupon of 3% and an initial conversion premium of 30%, according to a company press release.
Pricing came at the cheap end of talk for a coupon of 2.5% to 3% and at the midpoint of talk for an initial conversion premium of 27.5% to 32.5%, according to a market source.
Morgan Stanley & Co. LLC (lead left) and J.P. Morgan Securities LLC were bookrunners for the Rule 144A offering, which carries an upsized greenshoe of $41.25 million.
The initial size of the deal was $250 million with a greenshoe of $37.5 million.
The notes are non-callable until June 20, 2023 and then subject to a 130% hurdle. They are putable upon a fundamental change.
The notes will be settled in cash, shares or a combination of both at the company’s option.
Net proceeds are expected to be $266.6 million, or $306.7 million if the greenshoe is exercised in full.
Proceeds will be used for general corporate purposes, including working capital, business development, sales and marketing and capital expenditures, according to a company news release.
Proceeds may also be used for acquisitions or strategic investments although no current agreements exist.
1Life Healthcare is a San Francisco-based membership-based primary health care provider.
| Issuer: | 1Life Healthcare Inc.
|
| Securities: | Convertible senior notes
|
| Amount: | $275 million
|
| Greenshoe: | $41.25 million
|
| Maturity: | June 15, 2025
|
| Bookrunners: | Morgan Stanley & Co. LLC (lead left) and J.P. Morgan Securities LLC
|
| Coupon: | 3%
|
| Price: | Par
|
| Yield: | 3%
|
| Conversion premium: | 30%
|
| Conversion price: | $44.43
|
| Conversion rate: | 22.5052
|
| Call options: | Non-callable until June 20, 2023 and then subject to a 130% hurdle
|
| Put options: | Upon a fundamental change
|
| Pricing date: | May 26
|
| Settlement date: | May 29
|
| Distribution: | Rule 144A
|
| Talk: | Coupon of 2.5% to 3% and initial conversion premium of 27.5% to 32.5%
|
| Stock symbol: | Nasdaq: ONEM
|
| Stock price: | $34.18
|
| Market capitalization: | $4.31 billion
|
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