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

May 2020 | read press release

Transaction Background

After a successful transaction in February, NuVasive was interested in opportunistically raising capital again to pre-fund an upcoming convertible maturity

NuVasive’s objectives:

  • De-risk the balance sheet and minimize costs of doing so

  • Minimizing market and stock price risk

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

  • Tactical considerations for existing convertible (repurchase vs leave outstanding), including options around existing bond hedge and warrant structure

  • Syndicate and fee structures

  • Accounting for convertible and call spread

  • Tax integration

  • Investor messaging

  • 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 and allow the Company to reward their banking relationships

Results

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

  • 1.00% coupon priced at the midpoint of the marketed coupon range

  • NUVA stock was down only 2.1% on the day of execution

Call spread raised effective conversion price to 65% above the closing stock price on the day of execution

JWCA advised management on the day of the offering, providing execution insight and ensuring a high-quality execution

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

This transaction is the second convertible offering by NuVasive in 2020, both of which JWCA helped advise and execute