JWCA advises NUVASIVE on its $450 million convertible and call spread

FEBRUARY 2020 | read press release

Transaction Background

NuVasive was interested in taking advantage of market conditions to optimize the balance sheet and pre-fund a convertible maturity in 2021

As part of the process, NuVasive also amended and extended the maturity of its existing credit facility.  JWCA helped the Company analyze the right mix of the two sources of debt capital and financial impacts

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

• Tactical considerations for existing convertible (repurchase vs leave outstanding)

• Syndicate and fee structures

• Call spread vs capped call

• Issuer redemption features

• Accounting for convertible and call spread

• Tax integration

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

JWCA designed and ran a call spread auction process to achieve competitive terms, which led to significant savings for the Company

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

Results

NuVasive’s convertible issuance was well-received by investors:

• 0.375% coupon priced at the low end of the marketed coupon range

• 35.0% conversion premium priced at the midpoint of the marketed premium range

• NUVA stock was down 2.6% on the day vs comps down 2 – 4%

Call spread raised effective conversion price to 85% above the closing stock price on the day of execution

JWCA was with the management team on the entire day of the offering providing execution advice and ensuring a high-quality execution

Call Spread documentation and auction process produced meaningful savings for NuVasive, while maximizing flexibility for the Company