Capital Southwest Announces Pricing of Convertible Notes Offering
Capital Southwest (CSWC) has announced the pricing of $200 million in 5.125% Convertible Notes due 2029, with an additional $30 million over-allotment option. The notes will pay quarterly interest and mature on November 15, 2029. The initial conversion rate is 40 shares per $1,000 principal amount, equivalent to a $25.00 per share conversion price, representing a 12% premium over the last reported stock price. The company expects net proceeds of approximately $193.6 million, which will be used to redeem its 4.50% Notes due 2026, repay revolving credit facility debt, and for general corporate purposes.
Capital Southwest (CSWC) ha annunciato il prezzo di 200 milioni di dollari in Note Convertibili al 5,125% con scadenza nel 2029, accompagnate da un'opzione di sovrallocazione di ulteriori 30 milioni di dollari. Le note pagheranno interessi trimestrali e scadranno il 15 novembre 2029. Il tasso di conversione iniziale è di 40 azioni per ogni 1.000 dollari di importo principale, equivalente a un prezzo di conversione di 25,00 dollari per azione, che rappresenta un premio del 12% rispetto all'ultimo prezzo di stampa delle azioni. L'azienda prevede introiti netti di circa 193,6 milioni di dollari, che saranno utilizzati per il rimborso delle sue Note al 4,50% in scadenza nel 2026, per ripagare il debito della linea di credito revolving, e per scopi aziendali generali.
Capital Southwest (CSWC) ha anunciado la fijación de precio de 200 millones de dólares en Notas Convertibles al 5,125% con vencimiento en 2029, con una opción adicional de sobreasignación de 30 millones de dólares. Las notas pagarán intereses trimestrales y vencerán el 15 de noviembre de 2029. La tasa de conversión inicial es de 40 acciones por cada 1,000 dólares de monto principal, equivalente a un precio de conversión de 25.00 dólares por acción, representando una prima del 12% sobre el último precio de las acciones informado. La compañía espera ingresos netos de aproximadamente 193.6 millones de dólares, que se utilizarán para redimir sus Notas al 4.50% con vencimiento en 2026, para pagar la deuda de la línea de crédito revolving, y para propósitos corporativos generales.
캐피탈 사우스웨스트 (CSWC)가 2029년 만기 5.125% 전환사채 2억 달러의 가격을 발표했습니다. 추가로 3천만 달러의 초과배정 옵션이 마련되어 있습니다. 이 채권은 분기별 이자를 지급하며 2029년 11월 15일에 만기가 됩니다. 초기 전환 비율은 원금 1,000달러당 40주이며, 이는 주당 25.00달러의 전환 가격에 해당하며, 마지막 보고된 주가에 대해 12%의 프리미엄을 나타냅니다. 회사는 1억 9천 3백 60만 달러의 순 수익을 기대하고 있으며, 이는 2026년에 만기 도래하는 4.50% 채권을 환매하고, 순환 신용 시설 채무를 상환하며, 일반 기업 용도로 사용될 것입니다.
Capital Southwest (CSWC) a annoncé la tarification de 200 millions de dollars en Obligations Convertibles à 5,125% échéant en 2029, avec une option de surallocation additionnelle de 30 millions de dollars. Les obligations paieront des intérêts trimestriels et arriveront à maturité le 15 novembre 2029. Le taux de conversion initial est de 40 actions pour 1 000 dollars de montant principal, équivalent à un prix de conversion de 25,00 dollars par action, représentant une prime de 12% par rapport au dernier prix de l'action rapporté. La société prévoit des produits nets d'environ 193,6 millions de dollars, qui seront utilisés pour racheter ses Obligations à 4,50% échéant en 2026, rembourser sa dette de crédit revolving, et pour des besoins d'entreprise généraux.
Capital Southwest (CSWC) hat die Preisgestaltung von 200 Millionen Dollar in 5,125% wandelbaren Anleihen mit Fälligkeit im Jahr 2029 bekannt gegeben, einschließlich einer zusätzlichen Überzeichenungsoption von 30 Millionen Dollar. Die Anleihen zahlen vierteljährliche Zinsen und laufen am 15. November 2029 aus. Der anfängliche Umwandlungsverhältnis beträgt 40 Aktien pro 1.000 Dollar Nennbetrag, was einem Umwandlungspreis von 25,00 Dollar pro Aktie entspricht und einen Aufschlag von 12% gegenüber dem zuletzt gemeldeten Aktienkurs darstellt. Das Unternehmen erwartet netto Einnahmen von etwa 193,6 Millionen Dollar, die verwendet werden, um seine 4,50% Anleihen mit Fälligkeit 2026 einzulösen, um Schulden aus revolvierenden Kreditfazilitäten zurückzuzahlen und für allgemeine Unternehmenszwecke.
- Successful pricing of $200 million convertible notes offering
- Higher interest rate of 5.125% compared to previous 4.50% notes being redeemed
- 12% premium on conversion price compared to current stock price
- Additional $30 million over-allotment option available
- Increased debt obligation with new $200 million notes
- Higher interest expense with 5.125% rate
- Potential dilution risk if notes are converted to common stock
Insights
This convertible notes offering represents a significant financial move for Capital Southwest. The
The strategic use of proceeds to refinance existing debt, particularly the retirement of
DALLAS, Nov. 05, 2024 (GLOBE NEWSWIRE) -- Capital Southwest Corporation (Nasdaq: CSWC) (“Capital Southwest”) today announced the pricing of
The notes will be senior unsecured obligations of Capital Southwest and will accrue interest payable quarterly in arrears on February 15, May 15, August 15 and November 15 of each year, beginning on February 15, 2025 at a rate of
Noteholders may convert their notes at their option at any time prior to the close of business on the business day immediately preceding the maturity date.
Upon conversion, Capital Southwest will pay or deliver, as the case may be, cash, shares of Capital Southwest’s common stock or a combination of cash and shares of Capital Southwest’s common stock, at Capital Southwest’s election. The conversion rate will initially be 40.0000 shares of Capital Southwest’s common stock per
Capital Southwest may not redeem the notes prior to November 20, 2027. Capital Southwest may redeem for cash all or any portion of the notes (subject to certain limitations), at Capital Southwest’s option, on a redemption date on or after November 20, 2027 and on or before the 45th scheduled trading day immediately prior to the maturity date if the last reported sale price of Capital Southwest’s common stock has been at least
If Capital Southwest undergoes a fundamental change, then, subject to certain conditions, noteholders may require Capital Southwest to repurchase for cash all or any portion of their notes at a fundamental change repurchase price equal to
Capital Southwest estimates that the proceeds from the offering will be approximately
Oppenheimer & Co. is acting as sole book-running manager for the offering.
The proposed offering is being conducted pursuant to Capital Southwest’s automatic shelf registration statement on Form N-2, including a base prospectus, that was filed with the Securities and Exchange Commission (the “SEC”) on October 29, 2024 and became effective upon filing. A preliminary prospectus and accompanying prospectus relating to the proposed offering were filed with the SEC and are available for free on the SEC’s website located at http://www.sec.gov. A final prospectus supplement and accompanying prospectus relating to the proposed offering will be filed with the SEC and will be available for free on the SEC’s website located at http://www.sec.gov. Copies of the final prospectus supplement relating to this offering and the accompanying prospectus may be obtained, when available, from: Oppenheimer & Co. Inc., Attention: Syndicate Prospectus Department, 85 Broad Street, 26th Floor, New York, NY 10004, by telephone at (212) 667-8055, or by email at EquityProspectus@opco.com.
This press release, the pricing term sheet, the preliminary prospectus supplement and the accompanying prospectus are neither an offer to sell nor a solicitation of an offer to buy any securities, nor shall they constitute an offer, solicitation or sale of any securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or jurisdiction.
About Capital Southwest
Capital Southwest Corporation (Nasdaq: CSWC) is a Dallas, Texas-based, internally managed business development company with approximately
Forward-Looking Statements
This press release contains “forward-looking” statements, as that term is defined under the federal securities laws, including statements concerning the closing of the offering of the notes, the anticipated use of proceeds from the offering, the potential impact of the foregoing or related transactions on dilution to holders of Capital Southwest’s common stock or the market price of Capital Southwest’s common stock or the notes. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Capital Southwest’s control. Capital Southwest’s actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to whether Capital Southwest will consummate the offering of notes on the expected terms or at all, which could differ or change based upon market conditions or for other reasons, and the other risks detailed in Capital Southwest’s Form 10-K filed with the SEC for the year ended March 31, 2024, in Capital Southwest’s quarterly report on Form 10-Q for the quarter ended September 30, 2024 and in other filings and reports that Capital Southwest may file from time to time with the SEC. The forward-looking statements included in this press release represent Capital Southwest’s views as of the date of this press release. Capital Southwest anticipates that subsequent events and developments will cause Capital Southwest’s views to change. Capital Southwest undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing Capital Southwest’s views as of any date subsequent to the date of this press release.
Investor Relations Contact:
Michael S. Sarner, Chief Financial Officer
214-884-3829
FAQ
What is the interest rate and maturity date of CSWC's new convertible notes?
What is the conversion price for CSWC's 2029 convertible notes?
How will CSWC use the proceeds from the convertible notes offering?
When can CSWC redeem the 2029 convertible notes?
