|Wright Medical Group N.V. Announces Private Placement of $675 Million of 1.625% Cash Convertible Senior Notes Due 2023|
The notes will be senior unsecured obligations of WMG and pay interest semiannually in arrears at a rate of 1.625% per annum on
Concurrently with the sale of the notes, a limited number of investors that are current holders of WMG’s existing 2.00% cash convertible senior notes due 2020 (the “existing notes”) have entered into privately negotiated agreements to exchange approximately
In connection with the issuance of the notes, WMG and the Company have entered into privately negotiated cash convertible note hedge transactions with certain financial institutions (the “option counterparties”). The cash convertible note hedge transactions are generally intended to reduce the net amount of cash payments that WMG may be required to make upon conversion of the notes to the extent that such cash payments exceed the principal amount of converted notes. The Company also has entered into separate privately negotiated warrant transactions with the option counterparties to sell the option counterparties warrants to purchase the Company’s ordinary shares. The warrants have an initial strike price of
The Company estimates that the net proceeds of the issuance will be approximately
The Company has been advised that, in connection with establishing their initial hedge positions with respect to the cash convertible note hedge and warrant transactions, the option counterparties (or their respective affiliates) have entered into various derivative or other hedging transactions with respect to the Company’s ordinary shares concurrently with or shortly after the pricing of the notes. These hedging activities could increase (or reduce the size of any decrease in) the market price of the Company’s ordinary shares or the notes.
In addition, the option counterparties or their respective affiliates may modify their hedge positions following the pricing of the notes from time to time by entering into or unwinding various derivatives with respect to the Company’s ordinary shares and/or purchasing or selling ordinary shares or other securities of the Company in secondary market transactions (and are likely to do so during any observation period related to a conversion of notes). This activity could impact the market price of the Company’s ordinary shares or the notes, which could affect the ability to convert the notes and, to the extent the activity occurs during any observation period related to a conversion of notes, it could affect the amount of cash holders will receive upon conversion of the notes.
In addition, in connection with the exchange, the Company and WMG expect to enter into agreements with the counterparties (the “existing option counterparties”) to WMG’s existing convertible note hedge transactions to terminate a portion of such existing convertible note hedge transactions in a notional amount corresponding to the amount of the existing notes exchanged (the “unwind agreements”). Pursuant to the unwind agreements, the existing option counterparties will also terminate a portion of the Company’s existing warrant transactions in respect of the existing notes with the existing option counterparties. In connection with any termination of existing convertible note hedge and existing warrant transactions and the related unwinding of the existing hedge position of the existing option counterparties with respect to such transactions, such existing option counterparties and/or their respective affiliates may sell the Company’s ordinary shares in secondary market transactions, and/or enter into or unwind various derivative transactions with respect to the Company’s ordinary shares. Any of these activities could decrease (or reduce the size of any increase in) the market price of the Company’s ordinary shares at that time and it could decrease (or reduce the size of any increase in) the market value of the notes offered hereby.
This press release shall not constitute an offer to sell or a solicitation of an offer to buy the notes or any other securities, and shall not constitute an offer, solicitation or sale in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful.
The offer and sale of the notes have not been registered under the Securities Act or any state securities laws. The notes may not be offered or sold in
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements, including statements regarding the estimated net proceeds of the issuance and warrant transactions, the expected effect of the hedge and warrant transactions and the Company’s planned use of the net proceeds from the sale of the notes. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in or implied by the forward-looking statements, including, without limitation, whether or not the Company will be able to consummate the issuance of notes, the concurrent exchange or the hedge and warrant transactions on the timelines or with the terms anticipated, if at all, and, if consummated, whether the hedge and warrant transactions will have the anticipated effect of reducing the Company’s exposure under the notes to future increases in the price of the Company’s ordinary shares. Management retains broad discretion over the use of proceeds from the sale of the notes. You are encouraged to read the Company’s filings with the
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