Fiverr Announces Pricing of Private Offering of $400 Million of 0% Convertible Senior Notes Due 2025
Fiverr International Ltd. (NYSE: FVRR) has priced $400 million of 0% Convertible Senior Notes due 2025 in a private offering. The notes have an initial conversion rate of 4.6823 shares per $1,000, translating to a conversion price of approximately $213.57, a 40% premium over the October 7, 2020 closing price. The offering is expected to net $388.8 million, aimed at financing capped call transactions and general corporate purposes. The notes will not accrue regular interest and are subject to specific conditions for conversion and redemption.
- Net proceeds from the Offering expected to be $388.8 million, allowing for further investment in corporate growth.
- Capped call transactions may reduce potential dilution for ordinary shareholders.
- Dilution risk if the Notes are converted into shares, especially with a high conversion price.
- Market price fluctuations may occur due to initial hedges related to the capped call transactions.
NEW YORK--(BUSINESS WIRE)--Fiverr International Ltd. (NYSE: FVRR) (“Fiverr”) today announced the pricing of
The Notes will not bear regular interest, and the principal amount of the Notes will not accrete. The Notes will mature on November 1, 2025, unless earlier repurchased, redeemed or converted in accordance with their terms. The Notes will be convertible based on an initial conversion rate of 4.6823 ordinary shares of Fiverr per
Fiverr may not redeem the Notes prior to November 5, 2023, except in the event of certain tax law changes. On or after November 5, 2023, Fiverr may redeem, for cash, all or part of the Notes if the last reported sale price of its ordinary shares has been at least
Holders of the Notes will have the right to require Fiverr to repurchase all or a portion of their Notes upon the occurrence of a fundamental change (as defined in the indenture governing the Notes) at a cash repurchase price equal to
When issued, the Notes will be Fiverr’s senior unsecured obligations and will rank senior in right of payment to any of Fiverr’s unsecured indebtedness that is expressly subordinated in right of payment to the Notes; equal in right of payment to any of Fiverr’s unsecured indebtedness that is not so subordinated; effectively junior in right of payment to any of Fiverr’s secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all indebtedness and other liabilities (including trade payables) of Fiverr’s subsidiaries.
In connection with the pricing of the Notes, Fiverr has entered into privately negotiated capped call transactions with certain of the initial purchasers of the Notes or their respective affiliates and other financial institutions (in this capacity, the “Option Counterparties”). The capped call transactions are expected generally to reduce the potential dilution to the holders of ordinary shares of Fiverr upon any conversion of Notes and/or to offset any cash payments Fiverr is required to make in excess of the principal amount of converted Notes, as the case may be, with such reduction and/or offset subject to a cap. The cap price of the capped call transactions will initially be
Fiverr has been advised that, in connection with establishing their initial hedges of the capped call transactions, the Option Counterparties or their respective affiliates expect to purchase ordinary shares of Fiverr and/or enter into various derivative transactions with respect to the ordinary shares of Fiverr concurrently with or shortly after the pricing of the Notes. This activity could increase (or reduce the size of any decrease in) the market price of the ordinary shares of Fiverr or the Notes at that time. In addition, the Option Counterparties or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to the ordinary shares of Fiverr and/or by purchasing or selling ordinary shares or other securities of Fiverr in secondary market transactions from time to time prior to the maturity of the Notes (and are likely to do so following any conversion, repurchase, or redemption of the Notes, to the extent Fiverr exercises the relevant election under the capped call transactions). This activity could also cause or avoid an increase or a decrease in the market price of the ordinary shares of Fiverr or the Notes, which could affect the ability of holders of Notes to convert the Notes and, to the extent the activity occurs during any observation period related to a conversion of the Notes, it could affect the number of ordinary shares of Fiverr, if any, and value of the consideration that holders of Notes will receive upon conversion of the Notes.
In addition, if any such capped call transactions fail to become effective, whether or not the Offering is completed, the Option Counterparties party thereto or their respective affiliates may unwind their hedge positions with respect to the ordinary shares of Fiverr, which could adversely affect the value of the ordinary shares of Fiverr and, if the Notes have been issued, the value of the Notes.
Fiverr estimates that the net proceeds from the Offering will be approximately
The Notes were offered only to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act. The offer and sale of the Notes and the ordinary shares of Fiverr potentially issuable upon conversion of the Notes, if any, have not been, and will not be, registered under the Securities Act, any state securities laws or the securities laws of any other jurisdiction, and unless so registered, the Notes and such shares, if any, may not be offered or sold in the United States except pursuant to an applicable exemption from such registration requirements.
This press release does not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any offer or sale of, the Notes (or any ordinary shares of Fiverr issuable upon conversion of the Notes) in any state or jurisdiction in which the offer, solicitation, or sale would be unlawful prior to the registration or qualification thereof under the securities laws of any such state or jurisdiction.
About Fiverr
Fiverr’s mission is to change how the world works together. For over 10 years, the Fiverr platform has been at the forefront of the future of work connecting businesses of all sizes with skilled freelancers offering digital services in more than 400 categories, across 8 verticals including graphic design, digital marketing, programming, video and animation. In the twelve months ended June 30, 2020, 2.8 million customers bought a wide range of services from freelancers across more than 160 countries.
Forward-Looking Statements
This press release contains forward-looking statements, within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. Such forward-looking statements may include, among other things, expectations regarding actions of the Option Counterparties and their respective affiliates; the satisfaction of customary closing conditions with respect to the Offering and the anticipated use of the net proceeds of the Offering, and may be identified by words like “anticipate,” “assume,” “believe,” “aim,” “forecast,” “indication,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “outlook,” “future,” “will,” “seek” and similar terms or phrases. The forward-looking statements contained in this announcement are based on management’s current expectations, which are subject to uncertainty, risks and changes in circumstances that are difficult to predict and many of which are outside of our control.
Important factors that could cause actual outcomes to differ materially from those indicated in the forward-looking statements include, among others, the uncertainty surrounding the duration and severity of COVID-19 and its effects on our business; the risk that the Offering will not be consummated; and changes in global, national, regional or local economic, business, competitive, market, regulatory and other factors discussed under the heading “Risk Factors” in the Company’s 2019 annual report on Form 20-F filed with the Securities and Exchange Commission on March 31, 2020. Any forward-looking statement made by Fiverr in this press release speaks only as of the date hereof. Factors or events that could cause Fiverr’s actual results to differ may emerge from time to time, and it is not possible for Fiverr to predict all of them. Fiverr undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future developments or otherwise.
