8-KOther EventsExhibits & Filings

Elevance Health, Inc. 8-K Report, Corporate Update (May 12, 2015)

Filed May 12, 2015For Securities:ELV

Summary

Elevance Health, Inc. (formerly Anthem Inc.) announced the successful closing of a significant equity offering on May 12, 2015, raising approximately $1.25 billion in gross proceeds from the sale of 25 million Equity Units. An additional option for 1.5 million units was also exercised, further increasing the total capital raised. The company intends to use these net proceeds of roughly $1.225 billion for general corporate purposes. A key planned use of these funds is to repurchase approximately $700.5 million of its outstanding 2.750% Senior Convertible Debentures due 2042. Each Equity Unit is structured as a purchase contract for a future stock purchase, combined with an undivided beneficial ownership interest in 1.90% Remarketable Subordinated Notes due 2028. The company will pay quarterly contract adjustment payments on these units. This transaction diversifies the company's capital structure and provides flexibility for debt management, specifically addressing a portion of its convertible debt. Investors should note the specifics of the Equity Unit structure, including the future obligation to purchase common stock and the interest-bearing notes involved.

Key Highlights

  • 1Elevance Health (then Anthem Inc.) closed an offering of 25 million Equity Units for $1.25 billion on May 12, 2015.
  • 2An additional 1.5 million Equity Units were purchased under an underwriters' option, raising further capital.
  • 3Net proceeds from the offering are estimated at approximately $1.225 billion.
  • 4Proceeds will be used for general corporate purposes, including the repurchase of approximately $700.5 million of its 2.750% Senior Convertible Debentures due 2042.
  • 5Each Equity Unit consists of a forward purchase contract for Elevance Health's common stock and an interest in 1.90% Remarketable Subordinated Notes due 2028.
  • 6Holders of Equity Units will receive quarterly contract adjustment payments at an annual rate of 3.35%.
  • 7The Notes are pledged as collateral to secure the obligation to purchase shares of Common Stock under the purchase contracts.

Frequently Asked Questions

This 8-K filing announces the closing of Elevance Health's (then Anthem Inc.) substantial offering of Equity Units and details the use of the proceeds, which include repurchasing a significant portion of its outstanding convertible debentures.

Elevance Health raised approximately $1.25 billion in aggregate stated amount from the sale of 25 million Equity Units, with an additional $75 million raised from the full exercise of the underwriters' option for another 1.5 million units. The net proceeds are expected to be around $1.225 billion.

The company intends to use the net proceeds for general corporate purposes. A significant planned use is to repurchase approximately $700.5 million of its 2.750% Senior Convertible Debentures due 2042.

An Equity Unit, with a stated amount of $50, comprises two components: (i) a purchase contract obligating the holder to buy Elevance Health's common stock at a future date (May 1, 2018), and (ii) a beneficial ownership interest in $1,000 principal amount of the company's 1.90% Remarketable Subordinated Notes due 2028. The notes serve as collateral for the stock purchase obligation.