8-KSecurities & ListingRegulation FDExhibits & Filings

Liberty Media Corp 8-K Report, Unregistered Securities Sale (Mar 10, 2023)

Filed March 10, 2023For Securities:FWONKFWONAFWONB

Summary

Liberty Media Corporation (FWONK) announced the closing of a private offering of $575 million aggregate principal amount of 3.75% Senior Convertible Notes due 2028. These notes were sold to qualified institutional buyers and represent a significant capital raise for the company. The issuance allows Liberty Media to raise funds while offering investors convertible debt with specific conversion features tied to the performance of its Series A Liberty SiriusXM common stock. The notes are convertible into Series A Liberty SiriusXM common stock at an initial conversion price of approximately $38.61 per share, offering potential upside participation for noteholders if the stock price appreciates. This offering is structured to comply with regulatory requirements, utilizing exemptions under the Securities Act of 1933, including Rule 144A for resales to qualified institutional buyers. The conversion terms are designed to provide benefits to noteholders under certain market conditions, such as significant stock price appreciation or specific corporate events, while also offering flexibility to Liberty Media. Investors should monitor the performance of Liberty SiriusXM's Series A common stock as it directly impacts the conversion value and potential equity dilution from these notes.

Key Highlights

  • 1Liberty Media Corp. closed a private offering of $575 million in 3.75% Senior Convertible Notes due 2028.
  • 2The notes were sold to qualified institutional buyers under Rule 144A, exempt from standard registration requirements.
  • 3The initial conversion rate is 25.9000 shares of Series A Liberty SiriusXM common stock per $1,000 principal amount of notes.
  • 4This equates to an initial conversion price of approximately $38.61 per share of Series A Liberty SiriusXM common stock.
  • 5Holders can convert notes under specific conditions, including stock price performance thresholds and corporate events.
  • 6Liberty Media may deliver cash, shares, or a combination of both upon conversion.
  • 7The company is obligated to potentially increase the conversion rate under specific make-whole fundamental change or redemption scenarios.

Frequently Asked Questions

The primary purpose is to raise capital for Liberty Media Corporation, with the notes providing a source of funding while offering investors a debt instrument with potential equity upside tied to the performance of Series A Liberty SiriusXM common stock.

Notes can be converted under several conditions: if the Series A Liberty SiriusXM common stock price meets certain thresholds for a specified period, if the trading price of the notes falls below a certain percentage of their conversion value, if the company calls the notes for redemption, or upon specified corporate events. Holders can also convert after December 15, 2027, until maturity.

The initial conversion price is approximately $38.61 per share of Series A Liberty SiriusXM common stock. If the market price of this stock rises significantly above this conversion price, holders of the notes may find it advantageous to convert their notes into stock, potentially realizing a profit.

In the event of a make-whole fundamental change or if the company calls the notes for redemption, the conversion rate may be increased under certain circumstances, providing additional shares to the converting noteholder as described in the Indenture.