SBA Raising Cash After Revenue Target (SBAC)
SBA Communications Corp. (SBAC) has made two announcements this morning which could have an impact on shareholders. First, it reaffirmed its March quarter revenue targets of $132.0 million to $136.0 million, and Thomson Reuters estimates are $135 million. The company…
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SBA intends to offer some $350 million of convertible senior notes due October 2014 under a 144A private placement offering to institutions. SBA also expects to grant the initial purchasers an option to purchase up to $50 million of additional notes to cover over-allotments. Prior to July 22, 2014, the notes will be convertible at agreed to terms.
The company also intends to use a portion of the offering proceeds to enter into convertible note hedge transactions to reduce the potential dilution to the common stock with an initial strike price of roughly 180% of the price at the time of the offering. This will also replace a hedging transaction from 2007.
We have not seen any trade indications, but $350 million compares to a market cap of $3.12 billion and compares to total debt of over $2.548 billion and total liabilities of $2.719 billion.
Jon C. Ogg
April 20, 2009
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