Healthways’ officials said Tuesday they have come to terms with institutional investors looking to buy five-year convertible debt.
The Franklin-based wellness services provider will raise $125 million, up from the $100 million executives had been targeting. The debt's interest rate will be 1.5 percent and investors have the option to buy another $25 million of the notes.
Healthways plans to use proceeds from the sale of the notes — which are convertible only into cash — to pay down some of the company’s other debts, which totaled $257 million as of March 31.
In a statement, Healthways officials said "the conversion rate for the notes will initially be 51.3769 shares of common stock per $1,000 principal amount, which is equivalent to an initial conversion price of approximately $19.46 per share of common stock. The initial conversion price of the notes represents a premium of approximately 20 percent to the $16.22 per share last reported sale price of the Company’s common stock on July 1, 2013."
Shares of the company (Ticker: HWAY) are down about 1 percent to $16.02 in Tuesday late-morning trading. Year to date, they're up about 50 percent.
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