October 5, 2018 / 1:27 PM / 2 months ago

BUZZ-Tilray: Higher as convertible offering sees strong demand

(Update. Adds bookrunners’ deal message)

** Tilray up ~6 pct at $153.50 premarket as cannabis maker’s convertible offering sees strong demand

** Co prices upsized $450 mln, 5-year convertible senior notes in private placement to institutional buyers

** Bookrunners Cowen, BMO and BofA-ML communicate this morning deal was north of 2x covered even on the upsize, sources say

** Order book comprises mix of new and existing investors, including long-only mutual funds and convertible-focused investors; 80 pct of deal allocated to top 25 accounts, with Tilray having “heavy hand” in allocations (sources)

** Offering priced with 5 pct coupon and convertible premium of 15 pct, midpoint of marketed terms

** Tilray to use net proceeds of ~$435 mln, or ~$500.5 mln if full overallotment is exercised, for working capital, future acquisitions and to repay approx $9.1 mln existing mortgage on British Columbia facility

** Tilray has skyrocketed since its Jul 19 debut. Shares are up ~800 pct from $17 IPO price, giving them market value of ~$14 bln

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