JWCA advises Omnicell on its inaugural $575 million convertible and call spread​

September 2020 | read press release

Transaction Background

Omnicell, Inc. (“OMCL”) wanted to raise capital to fund the continued organic and inorganic expansion of its healthcare automation platform

Omnicell’s objectives:

• Raise flexible capital to allow it to take advantage of strategic opportunities​

• Optimize capital structure and covenant flexibility through credit facility amendment and paydown of revolver​

• Take advantage of a strong, resilient convertible market​

• Raise capital at a premium to current stock price to minimize dilution​

• Further minimize dilution with a high-strike call spread and share repurchases​

• Target key equity-crossover and long-only convertible investors

JWCA advised Omnicell on deal structuring and related items, including

• Credit agreement negotiations​

• Investor messaging​

• Accounting considerations​

• Issuer redemption and make-whole mechanics​

• Cost of capital​

• Documentation​

• Syndicate economics

JWCA also designed and ran a call spread auction process to achieve competitive terms and diversify counterparty risk​

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

Results

Omnicell convertible issuance was very well-received by investors:

• Company was able to execute favorable final terms, with coupon at low end of marketed range, and conversion premium above the high end of marketed range​

• Achieved large allocations from long-only fundamental investors

Amended leverage covenant in credit agreement to be based on secured net leverage instead of total net leverage ​

Call spread auction process produced meaningful savings for Omnicell