JWCA advises Medallia Inc. on its inaugural $575 million convertible and capped call  

September 2020 | read press release

Transaction Background

Medallia Inc. successfully raised $575mm (inclusive of greenshoe) in the convertible market at very attractive terms (0.125% coupon and 35.0% conversion premium)

Notwithstanding the continued elevated market volatility, Medallia took advantage of strong investor interest to successfully execute its first convertible bond and capped call issuance

Medallia engaged J. Wood Capital Advisors to assist in the structuring, negotiation, documentation and execution of its transaction

JWCA provided extensive analysis for Medallia on deal structuring and related items, including:

• Convertible structuring: redemption options and implications on overall economics

• Derivative overlay: call spread vs capped call

• Accounting and tax analysis/implications

• Convertible and capped call documentation to ensure maximum value and future efficiency/flexibility for the company 

• Syndicate structure and precedent data

• Advice on pricing on the day of execution

JWCA designed and ran a capped call auction process to achieve competitive terms

JWCA provided advice, support and analysis throughout the negotiation and execution process

Results

Medallia’s convertible issuance was very well-received by investors

• The transaction was multiple times oversubscribed, reflecting very strong investor interest and demand in the Company's offering

• The 0.125% coupon represented the company-friendly end of the marketed coupon range

• The 35.0% conversion premium represented the midpoint of the marketed conversion premium range

Capped call documentation and auction process produced meaningful savings for Medallia, while maximizing flexibility for the Company