Dick's Sporting Goods announced the completion of its private offering of $172.5 million issue price of 2.375% senior convertible notes due 2024. The company recently had announced the pricing of $155 million issue price of the notes. In connection with the closing, the initial purchasers exercised their option to acquire an additional $17.5 million issue price of the notes for a total issue price of $172.5 million.
The company used a portion of the net proceeds for the net cost of a convertible bond hedge in connection with the notes and a separate warrant transaction. The impact of the hedge and warrant transactions is to offset potential future dilution from the conversion of the senior convertible notes. For the purpose of dilution, the hedge and warrant transactions effectively increase the conversion premium associated with the senior convertible notes during the term of these transactions from $78.62 up to $112.32 per share.
The company intends to use the remaining net proceeds for general corporate purposes, which may include investing in new stores, accelerating store growth and acquisitions of complementary companies or businesses
