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LVMH successfully placed $600m cash-settled synthetic convertible bonds
LVMH successfully placed $600m non-dilutive cash-settled convertible bonds due 2021 (the “Bonds”).
On the back of a strong demand during the placement, the offering size has been increased from $500m to $600m.
The Bonds will have a par value of $250 per Bond and will not pay any coupon (zero-coupon). The Bonds will be issued at an issue price of 103% of par value on February 16, 2016, the expected settlement date, and will be redeemed at par on February 16, 2021, corresponding to a yield to maturity of -0.59%.The initial conversion price will be expressed in euros and will represent a conversion premium of 37.5% over the Reference Price. The Reference Price will be determined as the arithmetic average of LVMH’s daily volume-weighted average share price in euros on the regulated market of Euronext in Paris over the Reference Period as defined below (the “Reference Price”). The initial conversion ratio of the Bonds will be determined on February 12, 2016, and will correspond to the nominal value per Bond divided by the initial conversion price converted in dollars.
The net proceeds of the issue of the Bonds will be used for general corporate purposes.
LVMH intends to apply for the Bonds to be admitted to trading on the Open Market (Freiverkehr) segment of the Frankfurt Stock Exchange.
Concurrently with the issuance of the Bonds, LVMH will purchase financial instruments linked to the performance of its own shares to hedge its economic exposure under the Bonds. The Bonds will not give right to any new or existing shares and LVMH will be protected against potential economic dilution. The initial hedging transactions in relation to such financial instruments will be implemented, through notably the purchase of LVMH shares on the market and off-market by one or several of the bookrunners of the offering, over a period of 6 trading days from February 5 until February 12, 2016 (inclusive) (the “Reference Period”).
This press release does not constitute a subscription offer of the Bonds and the offering of the Bonds does not constitute a public offering in any country, including in France.