Greater Bay Bancorp's $200 million proceeds overnighter talked at 0.25-0.75% yield, up 33-38%

By Ronda Fears

Nashville, March 17 - Greater Bay Bancorp launched $200 million in proceeds of 20-year zero-coupon convertible notes talked at a 0.25% to 0.75% yield to maturity with a 33% to 38% initial conversion premium for pricing before Thursday's open. The issue is being sold on swap with $47 million of proceeds earmarked to buy back stock from note purchasers.

Lehman Brothers is sole bookrunner of the Rule 144A deal.

The senior notes will be non-callable for five years with puts in years two, five, 10 and 15. There is a 120% contingent conversion trigger.

Holders will have dividend protection by way of a conversion ratio adjustment.

There is a greenshoe available for $40 million in proceeds.

The issue is expected to be rated Baa3 by Moody's and BBB- by Standard & Poor's.

After repurchasing stock, the Palo Alto, Calif.-based financial services concern said proceeds would be used for general corporate purposes.

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