JWCA advises Live Nation Entertainment on the first convertible offering of 2023: upsized $1bn convertible and capped call transaction to refinance existing convertible notes
january 2023 | read press release
Transaction Background
Live Nation Entertainment Inc (“LYV”) successfully raised $1 billion (inclusive of greenshoe) in the convertible market at attractive terms (3.125% coupon and 50.0% conversion premium)
Live Nation's objectives included:
Low cost of capital and optimize the balance sheet by repurchasing the outstanding 2023 Convertible Notes
LYV engaged J. Wood Capital Advisors to assist in the structuring, negotiation, documentation and execution of the transaction
JWCA provided extensive analysis on deal structuring and related items, including:
Re-financing tactics and analysis
Convertible and derivative overlay structuring
Convertible and capped call documentation to ensure maximum value and future efficiency/flexibility for the company
Accounting and tax analysis/implications
Syndicate structure and precedent data
Shareholder messaging
JWCA designed and ran a capped call auction process to achieve competitive terms
JWCA provided advice, support and analysis throughout the execution process
Results
Live Nation’s convertible issuance was extremely well received by investors
The transaction was multiple times oversubscribed and upsized by $50 million
The 3.125% coupon priced tighter than the 3.25 – 3.75% marketed range and 50% conversion premium represented the high end of the marketed range.
The 50% conversion premium was the highest achieved since February 2022
LYV was the first tech company to upsize and price better than marketed coupon range since 2021
Live Nation was able to simultaneously retire $440 million of the 2023 Convertible Notes at a slight premium to market price
Live Nation’s stock price traded down 0.2%, compared to a typical stock price reaction of down 5 – 10%
Capped call documentation and auction process produced meaningful savings for Live Nation, while maximizing flexibility