Nashville, Tenn.-based SmileDirectClub is offering $650 million in aggregate principal amount of 0% convertible senior notes due in 2026, according to a news release.
The company increased the offering size from the previously announced $350 million with the intention of settling the issuance and sale of the notes on Feb. 9, 2021, subject to customary closing conditions.
In addition to the previously mentioned notes, SmileDirectClub granted the initial purchasers an option to purchase up to another $97.5 million in notes for a settlement period of 13 days from and including the date notes are first issued. The notes will mature on Feb. 1, 2026, unless earlier repurchased, redeemed or converted.
SmileDirectClub estimates that it will collect approximately $630 million in net proceeds, or approximately $725 million if the initial purchasers fully exercise their option to purchase additional notes.
The company plans to use approximately $60 million of the proceeds to fund the cost of entering into capped call transactions, with the remainder earmarked for general corporate purposes, including repaying amounts owed under existing credit facilities.