BOSTON - Haemonetics Corporation (NYSE: NYSE:HAE), a global healthcare company, announced today its plans to offer $525 million in Convertible Senior Notes due 2029 to qualified institutional buyers, with an additional option for purchasers to buy up to $75 million more in notes, subject to market conditions. These senior unsecured obligations will pay interest semi-annually and will mature on June 1, 2029, unless repurchased, redeemed, or converted earlier.
Noteholders will be entitled to convert their notes under certain conditions and during specified periods. Haemonetics will settle conversions up to the principal amount in cash and any excess in either cash, common stock, or a combination, at their discretion. The final terms, including the initial conversion price and interest rate, will be set at the time of pricing.
The company plans to use the net proceeds to fund capped call transactions and for general corporate purposes, including working capital and potential repayment or repurchase of debt. Capped call transactions with certain financial institutions are intended to minimize dilution from the conversion of notes or to offset potential cash payments above the principal amount, subject to a cap.
The initial transactions related to the capped calls may affect Haemonetics' common stock market price. Subsequent activities by the financial institutions or their affiliates, including derivative transactions and secondary market sales, could also influence the stock and note prices, potentially impacting noteholders' conversion outcomes.
The notes will be offered only to qualified institutional buyers in compliance with Rule 144A under the Securities Act, and will not be registered under the Securities Act or any state securities laws. Therefore, they cannot be sold without registration or an exemption from registration requirements.
InvestingPro Insights
As Haemonetics Corporation (NYSE: HAE) announces its significant financial maneuver with the offering of Convertible Senior Notes, investors and market watchers are closely monitoring the company's performance metrics and valuation. According to real-time data from InvestingPro, Haemonetics holds a market capitalization of $4.74 billion and has recently been trading near its 52-week high, with a price 95.66% of that peak. This suggests a strong market confidence in the company's prospects, as reflected in the stock's robust return of 30.03% over the last three months.
The company's financial health appears stable, with a Price/Earnings (P/E) ratio of 40.47, which is considered high, indicating that investors are willing to pay a premium for Haemonetics' earnings. This could be due to the company's solid revenue growth of 12.01% over the last twelve months as of Q4 2024, combined with a healthy gross profit margin of 54.13% in the same period. These metrics are critical for investors assessing the potential growth and profitability of Haemonetics, especially in light of the new capital they aim to raise through the Convertible Senior Notes.
Among the InvestingPro Tips, there are a few that stand out as particularly relevant to the current financial strategy of Haemonetics. The company is noted for having a high shareholder yield and cash flows that can sufficiently cover interest payments, which are encouraging signs for potential note purchasers. However, analysts have recently revised their earnings expectations downwards for the upcoming period, which could suggest caution regarding near-term performance.
For those interested in a more in-depth analysis, InvestingPro offers additional insights, including a total of 14 InvestingPro Tips that can help investors make more informed decisions. To access these tips, visit https://www.investing.com/pro/HAE. Moreover, readers can use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, providing even greater value for those seeking comprehensive investment tools and data.
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