Summary
U.S. Bancorp (USB) announced on July 31, 2001, that it has successfully completed a private offering of $1.1 billion in zero-coupon convertible senior notes due 2021. This transaction, which could reach up to $1.265 billion with over-allotment options, aims to raise capital primarily for the financing of the previously announced acquisition of NOVA Corporation, with remaining funds designated for general corporate purposes. The offering's structure as zero-coupon notes means interest is paid only under specific contingent events, and the notes will be convertible into U.S. Bancorp common stock under certain conditions, initially at a conversion price of $30.719 per share.
Key Highlights
- 1U.S. Bancorp raised approximately $1.1 billion in gross proceeds from the sale of zero-coupon convertible senior notes.
- 2The notes are due in 2021 and were sold in a private offering to qualified institutional buyers.
- 3Proceeds will be used to finance the acquisition of NOVA Corporation and for general corporate purposes.
- 4The notes are convertible into U.S. Bancorp common stock at an initial price of $30.719 per share under specified conditions.
- 5Interest is paid only upon the occurrence of certain contingencies, characteristic of zero-coupon instruments.
- 6U.S. Bancorp has the option to redeem the notes after August 6, 2003, at accreted value, and holders may have repurchase options on specific dates.
- 7The offering is expected to close on August 6, 2001.