Our Clients

Transaction and Process Overview

• Structuring
  • Matthews South designed this multi-step transaction to help Lyft achieve its capital markets objectives which included 1) purchase an up 100.0% capped call to minimize potential dilution, 2) repurchase stock of up to $100 million, 3) raise additional proceeds for future share repurchases and general corporate purposes, and 4) to mitigate stock price impact during execution.
  • We helped the company navigate multiple work streams, focusing on optimal structuring, documentation, pricing and execution of the transaction

• Call Spread Process
  • Our proprietary software allowed us to conduct an extensive auction and synthesize the results quickly
  • Auction included 20+ banks who provided bids on multiple allocations and multiple price points, ultimately allowing the company to optimize pricing and achieve a pre-tax yield of ~1.8% (inclusive of the call spread cost) with an effective conversion premium of 100.0% (no dilution until stock more than doubles)

• Marketing and Pricing
  • Due to strong investor demand, the new convertible offering was priced at the low end of the marketed coupon range (0.00% vs. 0.00 – 0.25%) and above the high end of the marketed conversion premium range (40.0% vs. 32.5 – 37.5%)
  • The concurrent stock repurchase of ~$100 million reduced potential investor hedging during marketing. Stock closed up 3.6% while the tech-focused Nasdaq index closed down 0.8%

Additional Deals for Lyft:

• February 2024: $460mm Convertible Notes Offering + Capped Call