Granite
Construction

Granite Construction is one of the largest diversified construction and construction materials companies in the United States.

Transaction Terms

Transaction

Exchange of $100MM principal amount of 2028 Convertible Senior Notes

Capped Call Unwind

$100MM notional

Settlement

Cash + potential shares hybrid construct

Execution

Privately negotiated wall-cross

Situation Overview

Liability management
amidst outperformance

In May 2023, HudsonWest advised Granite on the new issuance of convertible senior notes due 2028.

Granite stock had appreciated considerably since the 2028s' issuance, and with the stock above the up-125% capped call cap price, Granite turned to HudsonWest to review possible paths forward.

HudsonWest’s Role

Completing the
fourth mandate

Strategic Review

Granite and HudsonWest together reviewed a variety of options to address the 2028s, including various settlement methods and strategies related to the capped calls.

Hybrid Settlement Structure

Granite decided on a negotiated exchange using a mix of cash up to a specified threshold, with shares used to settle value above the threshold, allowing Granite to deploy surplus cash up to a known maximum.

Intraday Wall-Cross Execution

HudsonWest wall-crossed investors for a prompt intraday execution, identifying significant bondholders and negotiating a repurchase in the context of the market.

Capped Call Unwind Negotiation

HudsonWest negotiated with Granite's capped call counterparty banks to unwind $100MM notional in capped calls, reducing the cash outlay in retiring the bonds and completing HudsonWest's fourth mandate for Granite.

GraniteConstruction

Liability managementamidst outperformance

Completing thefourth mandate

Let's start aconversation.

Granite
Construction

Liability management
amidst outperformance

Completing the
fourth mandate

Let's start a
conversation.