It's been a volatile few days for investors in this software services provider for restaurant companies. Par Technology (PAR 4.06%) initially announced a public offering of stock and convertible senior notes on Sept. 13, and today the company announced the pricing of the offering.
The conversion rate for the 2027 notes will be 12.987 shares of stock for every $1,000 of notes, which is equivalent to a stock price of $77. This represents a 37.5% premium to the price per share in the equity offering. The offering is expected to close on Sept. 17, 2021.
ParTech's share price was trading up 8.5% at 2:43 p.m. EDT on Wednesday following the press release.
The aggregate net proceeds from the offering are expected to be approximately $275.4 million, excluding all underwriting expenses, commissions, and discounts. If underwriters exercise the option to fully subscribe to additional shares and 2027 notes, the proceeds could be as high as $309.3 million.
These proceeds could go a long way to accelerate the company's growth initiatives. ParTech is looking at a massive growth opportunity where about 1 million restaurants in the U.S. are spending a small portion of their revenue on marketing and technology, such as voice AI, which is rapidly changing how people order food.
ParTech recently completed the $500 million acquisition of Punchh in the second quarter, which creates a commerce cloud leader for large restaurants, serving 40 of the 100 largest restaurant companies. Management believes this acquisition should allow the combined company to help restaurant owners drive greater customer engagement through loyalty and promotional marketing. Analysts currently expect ParTech to grow earnings per share 18% per year over the next five years.