MCLEAN, Va.--(BUSINESS WIRE)--Gannett Co., Inc. (NYSE: GCI) (“Gannett”) announced today the pricing of its offering of $175 million aggregate principal amount of 4.750% Convertible Senior Notes due 2024. The notes will be sold in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"). The sale of the notes is expected to close on April 9, 2018, subject to customary closing conditions. Gannett also granted the initial purchaser of the notes an option to purchase up to an additional $26.25 million aggregate principal amount of notes, exercisable within a 30-day period.
The notes will be general unsecured obligations of Gannett, and interest will be payable semi-annually in arrears. The notes will mature on April 15, 2024, unless earlier converted, redeemed or repurchased. The initial conversion rate will be 82.4572 shares per $1,000 principal amount of notes (equivalent to a conversion price of approximately $12.13 per share of Gannett common stock), subject to adjustment on the occurrence of specified events. Prior to the close of business on the business day immediately preceding January 15, 2024, the notes will be convertible at the option of the holders only upon the satisfaction of certain circumstances. Thereafter, the notes will be convertible at the option of the holders at any time until the close of business on the second scheduled trading day immediately preceding the maturity date. Upon conversion, Gannett will pay or deliver, as the case may be, cash, shares of its common stock or a combination of cash and shares of its common stock, at its election, subject to certain restrictions.
Gannett may not redeem the notes prior to April 15, 2022. On or after April 15, 2022, Gannett may redeem for cash all or any portion of the notes, at its option, if the last reported sale price of the common stock is equal to or greater than 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending within the five trading days immediately preceding the date on which Gannett provides notice of redemption, at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. Holders of the notes may require Gannett to repurchase their notes upon a fundamental change at a repurchase price equal to 100% of the principal amount of the notes to be repurchased, plus accrued and unpaid interest to, but excluding, the repurchase date.
Gannett estimates that the net proceeds from the offering will be approximately $169.5 million (or approximately $195.0 million if the initial purchaser exercises in full its option to purchase additional notes), after deducting initial purchaser’s discounts and estimated offering expenses payable by Gannett. Gannett intends to use the net proceeds of this offering to repay borrowings under its revolving credit facility. Borrowings under Gannett’s revolving credit facility may be used for general corporate purposes, including acquisitions of or investments in businesses or assets, funding for working capital, capital expenditures, repayment of other debt and repurchases of our common stock.
The notes have not been and will not be registered under the Securities Act or applicable state securities laws, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state securities laws.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy the notes, nor shall there be any sale of the notes in any state or jurisdiction in which such offer, solicitation or sale would be unlawful.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that are not historical facts. Such statements include, but are not limited to, the ability of Gannett to satisfy the conditions to the closing of the offering and the intended use of the net proceeds from the offering. The words “believe,” “expect,” “estimate,” “could,” “should,” “intend,” “may,” “plan,” “seek,” “anticipate,” “project” and similar expressions, among others, generally identify forward-looking statements, which speak only as of the date the statements were made and are not guarantees of future performance. The matters discussed in these forward-looking statements are subject to many risks, trends, uncertainties, and other factors that could cause actual results to differ materially from those projected, anticipated, or implied in the forward-looking statements. Where, in any forward-looking statement, an expectation or belief as to future results or events is expressed, such expectation or belief is based on the current plans and expectations of our management, is expressed in good faith and is believed to have a reasonable basis. However, there can be no assurance the expectation or belief will result, be achieved or be accomplished. Whether or not any such forward-looking statements are in fact achieved will depend on future events, some of which are beyond our control. Except as may be required by law, we undertake no obligation to modify or revise any forward-looking statements to reflect new information, events, or circumstances occurring after the date of this press release. Factors, risks, trends, and uncertainties that could cause actual results or events to differ materially from those projected, anticipated, or implied include the matters described under the heading “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2017 and in our other SEC filings.
Gannett Co., Inc. (NYSE: GCI) is an innovative, digitally focused media and marketing solutions company committed to strengthening communities across our network. With an unmatched local-to-national reach, Gannett touches the lives of more than 117 million people monthly with our Pulitzer-Prize winning content, consumer experiences and benefits, and advertiser products and services. Gannett brands include USA TODAY NETWORK with the iconic USA TODAY and more than 100 local media brands, digital marketing services companies ReachLocal and SweetIQ, and U.K. media company Newsquest.