Enzon to hold off on further convertibles buybacks until discounts widen

By Cristal Cody

Tupelo, Miss., Feb. 19 - Enzon Pharmaceuticals Inc. said it wants to repurchase its convertible notes but is prepared to wait for attractive discounts.

"Obviously we would like to get more in, but we're not in an immediate hurry to do that. We will do that when it's a discount and a benefit to our shareholders," Craig Tooman, chief financial officer, said Thursday on an investors conference call.

The company said it repurchased $76.9 million in convertible notes during fiscal 2008, including $4.5 million of 4% convertible senior notes due in 2013.

In January, the company also held a modified Dutch auction tender for a portion of the 4% notes. Holders tendered $2.95 million of the $270.5 million principal when the offer expired on Jan. 21.

"We were repurchasing bonds in the open market at a discount prior to the initiation of this Dutch auction," Tooman said.

"We hoped to take a larger portion of the bonds trading in the 65 range. What happened during that time period is the markets moved higher and traded at 76. In the end, we weren't surprised that more didn't tender."

The Bridgewater, N.J.-based biopharmaceutical company on Thursday reported a loss of $0.5 million, or 1 cent a share, for the three months ended Dec. 31, compared to profit of $0.3 million, or 1 cent a share, for the fourth quarter of 2007.

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