On Monday, Jan. 15, 2017, Titan International Inc.'s 5.625% convertible senior subordinated notes matured. Two days later, 97.1% of the principal balance of the notes was converted into shares of Titan common stock.
Prior to maturity, $60,161,000 in aggregate principal amount of the notes was outstanding. After maturity, of $58,460,000 was converted to shares of Titan common stock pursuant to the terms of the indenture governing the notes.
After giving effect to the conversion and maturity of the notes, Titan’s $400 million senior secured notes due in 2020 are its only U.S. senior notes outstanding.
The $58,460,000 principal amount of converted notes was converted into 5,462,264 shares of Titan common stock, representing approximately 10% of Titan’s outstanding common stock prior to conversion. Each $1,000 principal amount of the notes was convertible into 93.436 shares of Titan common stock. The remaining $1,701,000 principal amount of the notes not converted was paid in cash.
The initial base conversion rate for the notes was 93.0016 shares of Titan common stock per $1,000 principal amount of the notes, equivalent to an initial base conversion price of approximately $10.75 per share of Titan common stock. The base conversion rate was increased by 0.4344 shares as determined pursuant to a formula described within the indenture governing the notes.
Titan's common stock on the New York Stock Exchange opened at $10.57 a share on Jan. 17, 2017.
"We believe this is a win-win for Titan and our new shareholders,” says Paul Reitz, Titan CEO and president.
“We’re pleased these convertible debt holders have chosen to become shareholders of Titan. We believe that the debt reduction and minimal cash outlay will further strengthen our capital position moving forward.”
For more information on Titan and its products, visit www.titan-intl.com.