Itron Costs $400 Million Zero Coupon Convertible Senior Notes Providing
LIBERTY LAKE, Wash.–(BUSINESS WIRE)–Itron, Inc. (NASDAQ: ITRI) (the “Firm”), which is innovating the best way utilities and cities handle vitality and water, at this time introduced the pricing of its personal providing of $400 million mixture principal quantity of its 0% convertible senior notes due 2026 (the “Notes”) to individuals moderately believed to be certified institutional patrons pursuant to Rule 144A underneath the Securities Act of 1933, as amended (the “Securities Act”). The Firm additionally granted the preliminary purchasers of the Notes an choice to buy, throughout a 13-day interval starting on, and together with the primary day the Notes are issued, an extra $60 million mixture principal quantity of Notes. The providing is anticipated to decide on March 12, 2021, topic to customary closing situations.
The Firm additionally introduced by separate press launch that it had priced the beforehand introduced registered public providing of three.9 million shares of widespread inventory of the Firm, at a public providing worth of $90.00 per share. The Firm additionally granted the underwriters of that providing a 30-day choice to buy as much as an extra 0.6 million shares of widespread inventory of the Firm. The providing of shares is anticipated to shut on March 12, 2021, topic to customary closing situations. The closing of the providing of the Notes just isn’t contingent upon the closing of the providing of widespread inventory (or vice versa).
The Notes won’t bear common curiosity, and the principal quantity of the Notes won’t accrete. The Notes will mature on March 15, 2026, until earlier transformed, redeemed or repurchased. The conversion charge will initially be 7.9365 shares of widespread inventory per $1,000 principal quantity of Notes, topic to adjustment in sure circumstances. This represents an preliminary conversion worth of $126.00 per share, representing a conversion premium of 40% over the general public providing worth within the Firm’s concurrent widespread inventory providing. The Notes will likely be convertible on the choice of the holders previous to December 15, 2025 solely throughout sure durations upon the prevalence of sure occasions and will likely be convertible thereafter at any time till the shut of enterprise on the second scheduled buying and selling day instantly previous the maturity date. Upon conversion, the Firm can pay money as much as the mixture principal quantity of Notes to be transformed and pay and/or ship, because the case could also be, money, shares of widespread inventory or a mixture of money and shares of widespread inventory, at its election, in respect of the rest, if any, of its conversion obligation in extra of the mixture principal quantity of the Notes being transformed.
As well as, the Notes will likely be redeemable, in entire or partially, for money on the Firm’s choice at any time, and once in a while, on or after March 20, 2024, however provided that the final reported sale worth per share of the Firm’s widespread inventory exceeds 130% of the conversion worth for a specified time period. If the Firm undergoes a “basic change” (as outlined within the indenture governing the Notes), holders of the Notes might require the Firm to repurchase for money all or any portion of their Notes at a repurchase worth equal to 100% of the principal quantity of the Notes to be repurchased, plus accrued and unpaid particular curiosity to, however excluding, the repurchase date. As well as, upon sure company occasions or upon redemption, the Firm will, underneath sure circumstances, enhance the conversion charge for holders who convert Notes in reference to such a company occasion or redemption.
In reference to the pricing of the Notes, the Firm entered into privately negotiated convertible observe hedge transactions with sure of the preliminary purchasers or their associates and different monetary establishments (the “hedge counterparties”). The convertible observe hedge transactions are anticipated typically to cut back the potential dilution to the Firm’s widespread inventory upon any conversion of the Notes and/or offset the money funds the Firm is required to make in extra of the principal quantity of transformed Notes, because the case could also be, within the occasion that the market worth of the widespread inventory is bigger than the strike worth of the convertible observe hedge transactions, which initially corresponds to the preliminary conversion worth of the related Notes. The Firm additionally entered into privately negotiated warrant transactions with the hedge counterparties. The warrant transactions may individually have a dilutive impact to the extent the market worth per share of widespread inventory exceeds the strike worth of any warrant transactions, until the Firm elects, topic to sure situations set forth within the associated warrant confirmations, to settle the warrant transactions in money. The strike worth of the warrant transactions will initially be roughly $180.00 per share, which represents a premium of roughly 100% over the general public providing worth within the Firm’s concurrent widespread inventory providing, and is topic to sure changes underneath the phrases of the warrant transactions. If the preliminary purchasers train their choice to buy extra Notes, the Firm might enter into extra convertible observe hedge transactions and extra warrant transactions with the hedge counterparties.
The Firm expects that, in reference to establishing their preliminary hedge of the convertible observe hedge transactions and warrant transactions, the hedge counterparties or their respective associates might enter into varied spinoff transactions with respect to the widespread inventory concurrently with, or shortly after, the pricing of the Notes, and will unwind these varied spinoff transactions and buy shares of widespread inventory in open market transactions shortly after the pricing of the Convertible Notes. These actions may enhance (or scale back the scale of any lower in) the market worth of the widespread inventory or the Notes at the moment. As well as, the Firm expects that the hedge counterparties or their respective associates might modify their hedge positions by coming into into or unwinding spinoff transactions with respect to the widespread inventory and/or by buying or promoting shares of the widespread inventory or different securities of the Firm in secondary market transactions following the pricing of the Notes and previous to the maturity date of the Notes (and are doubtless to take action throughout any statement interval regarding a conversion of the Notes or in reference to any repurchase of Notes). This exercise may additionally trigger or keep away from a rise or a lower available in the market worth of the widespread inventory or the Notes, which may have an effect on the power of noteholders to transform the Notes and, to the extent the exercise happens throughout any statement interval associated to a conversion of the Notes, may have an effect on the quantity and worth of the consideration that noteholders will obtain upon conversion of the Notes.
The Firm expects to make use of a portion of the web proceeds from the providing to pay the price of the convertible observe hedge transactions described above (after such value is partially offset by the proceeds to the Firm from the warrant transactions described above). The Firm expects to make use of the remaining internet proceeds from the providing, along with money available, to optionally redeem its excellent 5.00% senior notes due 2026 at a worth equal to 102.5% of the principal quantity thereof, plus accrued and unpaid curiosity, if any, to the redemption date. Such redemption will likely be made solely pursuant to a redemption discover delivered pursuant to the indenture governing the 5.00% senior notes due 2026, and nothing contained on this press launch constitutes a discover of redemption of the 5.00% senior notes due 2026.
The convertible notes will likely be supplied to individuals moderately believed to be certified institutional patrons in accordance with Rule 144A underneath the Securities Act. The convertible notes haven’t been, and won’t be, registered underneath the Securities Act, or the securities legal guidelines of any state or different jurisdiction, and, until so registered, might not be supplied or offered in america absent registration or an relevant exemption from registration necessities.
This press launch doesn’t represent a proposal to promote or a solicitation of a proposal to purchase the Notes and shall not represent a proposal, solicitation or sale in any jurisdiction through which such a proposal, solicitation or sale can be illegal previous to the registration and qualification underneath the securities legal guidelines of such state or jurisdiction.
Itron® allows utilities and cities to soundly, securely and reliably ship essential infrastructure providers to communities in additional than 100 nations. Our portfolio of good networks, software program, providers, meters and sensors helps our clients higher handle electrical energy, fuel and water sources for the folks they serve. By working with our clients to make sure their success, we assist enhance the standard of life, guarantee the security and promote the well-being of hundreds of thousands of individuals across the globe. Itron is devoted to making a extra resourceful world.
Itron® is a registered trademark of Itron, Inc. All third-party logos are property of their respective homeowners and any utilization herein doesn’t counsel or suggest any relationship between Itron and the third get together until expressly acknowledged.
Cautionary Be aware Concerning Ahead Trying Statements
This launch accommodates, and our officers and representatives might once in a while make, “forward-looking statements” throughout the that means of the secure harbor provisions of the U.S. Non-public Securities Litigation Reform Act of 1995. Ahead-looking statements are neither historic components nor assurances of future efficiency. These statements are primarily based on our expectations about, amongst others, revenues, operations, monetary efficiency, earnings, liquidity, earnings per share, money flows and restructuring actions together with headcount reductions and different value financial savings initiatives. This doc displays our present technique, plans and expectations and is predicated on data at the moment accessible as of the date of this launch. After we use phrases akin to “count on”, “intend”, “anticipate”, “imagine”, “plan”, “purpose”, “search”, “challenge”, “estimate”, “future”, “technique”, “goal”, “might”, “doubtless”, “ought to”, “will”, “will proceed”, and related expressions, together with associated to future durations, they’re meant to establish forward-looking statements. Ahead-looking statements depend on various assumptions and estimates. Though we imagine the estimates and assumptions upon which these forward-looking statements are primarily based are cheap, any of those estimates or assumptions may show to be inaccurate and the forward-looking statements primarily based on these estimates and assumptions might be incorrect. Our operations contain dangers and uncertainties, a lot of that are outdoors our management, and any certainly one of which, or a mixture of which, may materially have an effect on our outcomes of operations and whether or not the forward-looking statements in the end show to be appropriate. Precise outcomes and tendencies sooner or later might differ materially from these urged or implied by the forward-looking statements relying on a wide range of components. Due to this fact, you shouldn’t depend on any of those forward-looking statements. Among the components that we imagine may have an effect on our outcomes embody our means to execute on our restructuring plan, our means to attain estimated value financial savings, the speed and timing of buyer demand for our merchandise, rescheduling of present buyer orders, adjustments in estimated liabilities for product warranties, antagonistic impacts of litigation, adjustments in legal guidelines and rules, our dependence on new product growth and mental property, future acquisitions, adjustments in estimates for stock-based and bonus compensation, growing volatility in international change charges, worldwide enterprise dangers, uncertainties attributable to antagonistic financial situations, together with, with out limitation these ensuing from extraordinary occasions or circumstances such because the COVID-19 pandemic and different components which are extra totally described in Half I, Merchandise 1A: Danger Elements included in our newest Annual Report on Type 10-Ok filed with the SEC. Itron undertakes no obligation to replace or revise any data on this press launch.
The impression attributable to the continued COVID-19 pandemic contains uncertainty as to the period, unfold, severity, and any resurgence of the COVID-19 pandemic together with different components contributing to an infection charges, akin to reinfection or mutation of the virus, the effectiveness or widespread availability and utility of any vaccine, the period and scope of associated authorities orders and restrictions, impression on general demand, impression on our clients’ companies and workforce ranges, disruptions of our enterprise and operations, together with the impression on our staff, limitations on, or closures of, our services, or the enterprise and operations of our clients or suppliers. Our estimates and statements concerning the impression of COVID-19 are made in good religion to supply perception to our present and future working and monetary atmosphere and any of those might materially change attributable to components outdoors our management. For extra data on dangers related to the COVID-19 pandemic, please see Itron’s up to date threat in Half I, Merchandise 1A: Danger Elements of our newest Type 10-Ok filed with the SEC.