NEW YORK ─ Luminex said on Friday that it has priced a $260 million offering of 3 percent convertible senior notes due in 2025.
The firm expects the senior notes will generate about $218.3 million in proceeds after deducting estimated placement agent's fees, the net cost of bond hedge and warrant transactions, and estimated offering expenses. The initial conversion rate is 22.8918 shares of common stock per $1,000 principal amount of the convertible notes, equivalent to an initial conversion price of about $43.68 per share of Luminex's common stock.
Luminex said it anticipates using about $34.7 million to pay the net cost of convertible-note hedge transactions and the rest for working capital and other general corporate purposes.
The senior notes are general unsecured obligations of the firm with interest paid semiannually. They will mature on May 15, 2025, unless they have been repurchased, redeemed, or converted, Luminex said.
In connection with pricing the convertible notes, Luminex entered into privately negotiated convertible-note hedge transactions and warrant transactions with certain dealers ─ activities that are expected to reduce the potential dilution to Luminex's common stock upon any conversion of the convertible notes and to offset any cash payments Luminex is required to make in excess of the principal amount of the notes.
The warrant transactions could separately have a dilutive effect, the firm said, in the event that the market price per share of its common stock exceeds the applicable strike price of the warrants. The strike price of the warrant transactions will initially be about $69.89 per share, which represents a premium of approximately 80 percent over the last reported sale price of Luminex's common stock on May 7 and is subject to adjustments under the terms of the warrant transactions.