Cowen Prices Offering of $120 Million 3.00% Convertible Senior Notes Due 2022
December 11 2017 - 11:16PM
Business Wire
Cowen Inc. (NASDAQ: COWN) (“Cowen” or the “Company”) today
announced the pricing of its offering of $120 million aggregate
principal amount of 3.00% convertible senior notes due 2022. The
notes are being offered and sold to qualified institutional buyers
pursuant to Rule 144A under the Securities Act of 1933, as amended.
The Company also granted the initial purchasers of the notes an
option to purchase up to $15 million aggregate principal amount of
additional notes on the same terms and conditions. The offering is
expected to close on December 14, 2017, subject to customary
closing conditions.
Interest will be payable on the notes semi-annually at a rate of
3.00% per annum on June 15 and December 15 of each year, commencing
June 15, 2018. The notes will mature on December 15, 2022, unless
earlier repurchased, redeemed or converted prior to such date.
Prior to September 15, 2022, the notes will be convertible only
under certain conditions. Thereafter, until the close of business
on the second business day immediately preceding the maturity date
of December 15, 2022, the notes will be convertible at any time.
Conversions of the notes will be settled by the delivery and/or
payment, as the case may be, of Class A common stock, cash, or a
combination thereof, at the Company's election; provided that the
Company may not issue in excess of 19.9% of its Class A common
stock upon conversion of the notes unless and until such issuance
is approved by the Company’s stockholders. The Company will not
have the right to redeem the notes prior to December 15, 2020 and
thereafter may only redeem the notes under certain conditions. The
conversion rate for the notes will initially be 57.5540 shares of
Cowen’s Class A common stock per $1,000 principal amount of notes,
which is equivalent to an initial conversion price of approximately
$17.375 per share of Cowen’s Class A common stock. The initial
conversion price of the notes represents a premium of approximately
25% to the $13.90 per share last reported sale price of Cowen’s
Class A common stock on December 11, 2017. When issued, the notes
will be unsecured obligations of Cowen.
The Company estimates that the net proceeds from the offering
will be approximately $116.4 million (or $130.95 million if the
initial purchasers’ option to purchase additional notes is
exercised in full), after deducting the initial purchasers’
discounts and commissions but prior to taking into account any
estimated offering expenses payable by the Company. The estimated
offering expenses payable by the Company are $600,000.
The Company intends to use the net proceeds, together with cash
on hand, from the offering for general corporate purposes,
including the repurchase or repayment of $115.14 million of the
Company’s outstanding 3.0% cash convertible senior notes due 2019
and the repurchase of approximately $19.5 million of the Company’s
shares of its Class A common stock from purchasers of the notes in
privately negotiated transactions, which are expected to be
consummated substantially concurrently with closing of the
offering. The price of the Class A common stock repurchased in
these transactions is expected to equal the closing price per share
of the Company’s Class A common stock on the date of the pricing of
the offering. Repurchases of shares of the Company’s Class A common
stock could increase, or prevent a decrease in, the market price of
the Company’s Class A common stock or the notes. In the case of
repurchases effected concurrently with this offering, this activity
could affect the market price of the Company’s Class A common stock
concurrently with the pricing of the notes, and could result in a
higher effective conversion price for the notes.
This press release does not constitute an offer to sell or the
solicitation of an offer to buy the notes or any other securities,
nor will there be any sale of notes or any other securities in any
state or jurisdiction in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the
securities laws of any such state or jurisdiction.
The offer and sale of the notes have not been registered under
the Securities Act of 1933, as amended, or any state securities
laws and may not be offered or sold in the United States absent
registration or an applicable exemption from the registration
requirements.
About Cowen Inc.
Cowen Inc. is a diversified financial services firm and,
together with its consolidated subsidiaries, provides alternative
asset management, investment banking, research, sales and trading,
prime brokerage, global clearing and commission management through
its two business segments: Cowen Investment Management and its
affiliates make up the Company’s alternative investment segment,
while Cowen and Company, LLC, a member of FINRA and SIPC, and its
affiliates make up the Company’s broker-dealer segment. Cowen
Investment Management provides alternative asset management
solutions to a global client base and manages a significant portion
of Cowen’s proprietary capital. Cowen and Company and its
affiliates offer industry focused investment banking for
growth-oriented companies, domain knowledge-driven research, a
sales and trading platform for institutional investors and a
comprehensive suite of prime brokerage services. Founded in 1918,
the firm is headquartered in New York and has offices worldwide.
For additional information, visit www.cowen.com.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements.
Forward-looking statements provide the Company’s current
expectations or forecasts of future events. Forward-looking
statements include statements about the Company’s expectations,
beliefs, plans, objectives, intentions, assumptions and other
statements that are not historical facts. Forward-looking
statements are subject to known and unknown risks and uncertainties
and are based on potentially inaccurate assumptions that could
cause actual results to differ materially from those expected or
implied by the forward-looking statements, including without
limitation, whether or not the Company will offer the notes or
consummate the offering, enter into the prepaid forward share
repurchase transaction, the anticipated terms of the notes and the
offering, and the anticipated use of the proceeds of the offering.
The Company’s actual results could differ materially from those
anticipated in forward-looking statements for many reasons,
including the factors described in the section entitled “Risk
Factors” in the offering memorandum relating to the offering of the
notes and in the section entitled “Risk Factors” in the Company’s
Annual Report on Form 10-K and “Management’s Discussion and
Analysis of Financial Condition and Results of Operations” in the
Company’s Annual Report on Form 10-K and Quarterly Reports on Form
10-Q, as filed with the Securities and Exchange Commission. The
Annual Report on Form 10-K and Quarterly Reports on Form 10-Q are
available at our website at www.cowen.com and at the Securities and
Exchange Commission website at www.sec.gov. Unless required by law,
the Company undertakes no obligation to publicly update or revise
any forward-looking statement to reflect circumstances or events
after the date of this press release.
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version on businesswire.com: http://www.businesswire.com/news/home/20171211006361/en/
Investor Relations:CowenStephen Lasota, 212-845-7919Chief
Financial OfficerorNancy Wu, 646-562-1259orMedia:CowenLynda
Caravello, 646-562-1676lynda.caravello@cowen.comorGagnier
CommunicationsDan Gagnier, 646-569-5897dg@gagnierfc.com
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