$750 Million Investment Into Nutanix

Nutanix , Inc. announced that Bain Capital Private Equity will make an investment of $750 million in convertible senior notes to support the company’s growth initiatives.

“Bain Capital Private Equity has deep technology investing experience and a strong track record of helping companies scale,” said Dheeraj Pandey, chairman, co-founder and CEO, Nutanix. “Bain Capital Private Equity’s investment represents a strong vote of confidence in our position as a leader in the HCI market and our profound culture of customer delight.”

“Nutanix is executing on a compelling vision for a differentiated hybrid cloud platform that provides flexible environments and is easily paired with other cloud platforms,” commented David Humphrey, MD, Bain Capital Private Equity.

“We look forward to working closely with the Board and the management team to build on Nutanix’s leadership position and realize its strong vision for the future,” added Max de Groen, MD, Bain Capital Private Equity.

In connection with the investment, Humphrey and de Groen will join the Nutanix board of directors following the close of the transaction, which is expected to occur in late September 2020.

“We are pleased to establish this partnership with Bain Capital Private Equity and look forward to the contributions Dave and Max will make as new board members to build on Nutanix’s success,” concluded Ravi Mhatre, lead independent director

Bain Capital Private Equity has experience in the technology sector, having made investments in a range of companies including Applied Systems, BMC Software, CentralSquare Technologies, Kioxia, NortonLifeLock Inc., Rocket Software, Symantec, Viewpoint Construction Software, Vertafore, Waystar, and Zelis.

Under the terms of the investment, it will purchase $750 million in aggregate principal amount convertible senior notes. The notes will have an initial conversion price of $27.75 per share of the company’s Class A common stock, subject to customary anti-dilution and other adjustments. The initial conversion price of $27.75 represents a 30.6% premium to Nutanix’s volume-weighted average price (VWAP) over the trailing 5 trading day period prior to Bain Capital Private Equity’s signing of the definitive agreement to acquire the notes.

In addition, at the 12-month anniversary of the original issuance of the notes, depending on the achievement of financial milestones, the conversion price may be subject to an additional, one-time adjustment, to an amount in the range of $25.25 to $27.75 per share.

The notes will mature on September 15, 2026, unless earlier repurchased, redeemed or converted. They bear 2.5% interest per year, with such interest to be paid in kind on notes held by Bain Capital Private Equity through an increase in the principal amount of the Notes.

In connection with this transaction, Nutanix’s board has authorized the repurchase of up to $125 million of its Class A common shares that are intended to offset the dilutive effect of any shares the company may issue to settle the potential conversion of the Notes.

Goldman Sachs & Co. LLC is serving as exclusive financial advisor to and sole placement agent for Nutanix.