Encore Capital to price $80 million convertibles after the close Tuesday

New York, Sept. 12 - Encore Capital Group, Inc. said it plans to sell $80 million of convertibles senior notes due 2010.

The San Diego-based consumer accounts receivable management firm said the offering is set price after the markets close on Tuesday.

The deal has a $20 million greenshoe.

The notes will be non-callable and will convert into stock, or if stockholders approve, a combination of cash and stock.

Encore Capital will enter into convertible note hedge and warrant option transactions to reduce the potential dilution upon future conversion of the notes. The transactions will raise the effective initial conversion premium for the company to 60%.

The deal will come to market as a Rule 144A offering.

Encore will use proceeds left after the hedging transactions to repay part of its revolving credit facility.

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