Digital River to price $250 million 20-year convertibles to yield 2.25%-2.75%, up 27.5%-32.5%

By Rebecca Melvin

New York, Oct. 25 - Digital River Inc. plans to price $250 million of 20-year convertible senior notes after the market close on Tuesday that were talked at a coupon of 2.25% to 2.75% with an initial conversion premium of 27.5% to 32.5%, according to market sources.

The Rule 144A offering has a 15% greenshoe for up to $37.5 million of additional notes.

Joint bookrunners are Morgan Stanley & Co. Inc. and Bank of America Merrill Lynch.

The notes will be non-callable for five years, with investor puts in years five, 10 and 15.

The company plans to use up to $35 million of the net proceeds to repurchase shares under an existing share buyback program, with the remainder for general corporate and strategic purposes.

Eden Prairie, Minn.-based Digital River is a provider of electronic commerce outsourcing services.

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