JWCA advises BILL Holdings on its upsized $1.4 billion zero-coupon convertible and capped call transaction to refinance its outstanding convertible notes

december 2024 | read press release

Transaction Background

BILL Holdings, Inc. (“BILL” or the “Company”) successfully raised an upsized $1.4 billion (inclusive of greenshoe) in the convertible market at highly attractive terms (0.00% coupon and 35.0% conversion premium), while repurchasing $134mm (~80%) and $451mm (~79%) of its outstanding 2025 & 2027 convertible notes, respectively

BILL’s objectives included:

  • Opportunistically repurchase a majority of the outstanding 2025 & 2027 convertible notes to manage liabilities and capital structure

  • Protect against future equity dilution through both a derivative overlay and share repurchase concurrent with the convertible offering

  • Minimize stock price risk during execution after reaching a 52-week high in the weeks leading up to execution

JWCA provided extensive analysis on deal structuring and related items, including:

  • Refinancing tactics and analysis

  • Convertible and derivative overlay structuring

  • Hedging impact and share repurchase considerations

  • Convertible and capped call documentation to ensure maximum value and future efficiency/flexibility for the company

  • Execution timing

JWCA designed and ran a capped call auction process to achieve competitive terms

JWCA provided advice, support and analysis throughout the execution process

Results

BILL's convertible transaction was very well received by investors:

  • The transaction was multiple times oversubscribed, reflecting strong investor interest and demand in the Company’s convertible bond offering, leading to the issue being upsized by $250mm (25% of original $1bn base deal)

  • The 0.00% coupon represented the low end of the marketed coupon range

  • The 35.0% conversion premium was above the high end of the marketed conversion premium range

At the time of issuance, BILL is the only issuer post-covid to achieve a 0.00% coupon in three consecutive convertible transactions

Capped call documentation and auction process produced meaningful savings for BILL, driving economics in the Company's favor

The Company simultaneously repurchased ~2.3mm shares (~$200mm) from convertible investors