Wilmington, DE, Oct. 19, 2023 (GLOBE NEWSWIRE) -- Enovis™ Corporation (NYSE:ENOV, "Enovis" or the "Company")) today announced its intention to offer, subject to market conditions and other factors, $400 million aggregate principal amount of Convertible Senior Notes due 2028 (the "Notes") in a private offering (the "Offering"). In connection with the Offering, Enovis expects to grant the initial purchasers of the Notes an option to purchase, within a 13-day period beginning on, and including, the date on which the Notes are first issued, up to an additional $60 million aggregate principal amount of the Notes on the same terms and conditions.
In connection with the pricing of the Notes, the Company expects to enter into privately negotiated capped call transactions with one or more of the initial purchasers or their respective affiliates and/or other financial institutions (the "option counterparties"). The capped call transactions are expected generally to mitigate potential dilution to the Company's common stock upon conversion of any Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Notes, as the case may be, with such reduction and/or offset subject to a cap. If the initial purchasers exercise their option to purchase additional Notes, the Company expects to enter into additional capped call transactions with the option counterparties.
In connection with the capped call transactions, concurrently with or shortly after the pricing of the Offering, the Company expects the option counterparties or their respective affiliates to purchase shares of the Company's common stock and/or enter into various derivative transactions with respect to the Company's common stock. This activity could increase or reduce the size of any decrease in the market price of the Company's common stock and/or the Notes. Further, while the Notes are outstanding, these counterparties may modify any such hedge positions by entering into or unwinding such positions, or by purchasing or selling the Company's common stock or other securities in secondary market transactions. These counterparties are likely to engage in such activities at any exercise date of or termination of any portion of the capped call transactions. This activity could cause or avoid an increase or decrease in the market price of the Company's common stock and/or the Notes.
Enovis intends to use a portion of the net proceeds from the Offering to pay the cost of the capped call transactions. Enovis intends to use the remainder of the net proceeds from the Offering, together with approximately $400 million of borrowings under a new term loan facility, and cash on hand to fund the cash purchase price of the pending acquisition of LimaCorporate S.p.A. ("Lima") (the "Lima Acquisition"), with any remaining proceeds being used for general corporate purposes. Until the Lima Acquisition is consummated, Enovis intends to hold the net proceeds from the Offering in cash and cash equivalents or use the net proceeds from the Offering to pay down borrowings under its existing credit facility pending the closing of the transaction. If the initial purchasers exercise their option to purchase additional Notes, the Company expects to use a portion of the net proceeds from the sale of the additional Notes ...