NEW YORK (GenomeWeb) – Qiagen announced today that it plans to issue $400 million in senior, unsecured cash settled convertible notes convertible into common shares.
The company, which set the size of the issuance at $350 million before increasing it shortly thereafter to $400 million, said the number of ordinary shares underlying the notes will be up to 8.5 million, representing approximately 3.8 percent of its current outstanding shares.
The notes will have a maturity of six years, will be issued and redeemed at 100 percent of their principal amount, and will bear interest at an annual rate of .50 percent, payable semi-annually in arrears.
The initial conversion price will be set at a conversion premium of 30 percent above the reference share price, defined as the volume weighted average price of the Qiagen share between opening and close on the Nasdaq on Sept. 6. The company said it expects to price the notes today, and expects settlement to take place on or around Sept. 13.
The company also noted in a filing with the US Securities and Exchange Commission that it intends to issue the notes through a private placement outside the US, Canada, Australia, and Japan.
Qiagen said it intends to use net proceeds from the issuance for general corporate purposes, including entry into the convertible note hedge and warrant transactions.
In connection with the offering, Qiagen also said it intends to enter into privately negotiated convertible note hedge transactions with one or more counterparties, initially covering the same number of its common shares as underlie the notes. The convertible note hedge transaction will be cash settled upon exercise and is expected to offset any cash payments Qiagen is required to make in excess of the principal amount of the notes upon conversion. Qiagen also intends to enter into separate privately negotiated warrant transactions with such dealers, with the strike price of the warrants to be set at around 160 percent of the reference share price.
Qiagen's shares were down less than 1 percent to $31.81 in afternoon trading on the Nasdaq.