Reebok International Ltd. intends, subject to market and other conditions, to sell through a private offering up to $300 million of convertible debentures due 2024. The company will grant to the initial purchasers an option to purchase up to an additional $50 million of convertible debentures.
The company intends to use the net proceeds from this offering for general corporate purposes, which may include refinancing existing indebtedness (including the outstanding 4.25% Convertible Debentures due 2021), repurchasing shares of its common stock, financing acquisitions (including our proposed acquisition of The Hockey Company Holdings Inc.) and other general corporate purposes.
The company currently intends to redeem the $250 million outstanding principal amount of its 4.25% convertible debentures due 2021, subject to completion of this offering and market conditions.
The convertible debentures will be senior unsecured obligations of the company and will be convertible into Reebok common stock under certain conditions at an initial conversion price representing a to-be-determined premium to the current market price. It is expected that the convertible debentures will be interest bearing at a rate to be determined. The interest rate and other terms will be provided upon pricing of such convertible debentures. As a result of the restricted convertibility feature of the debentures, the common stock issuable upon conversion of the debentures would not be included in Reebok's fully diluted shares until the occurrence of specified future events.
