Isolagen $75 million convertibles talked at 3.25% to 3.75% yield, up 35% to 40%

By Ronda Fears

Nashville, Oct. 25 - Isolagen Inc. launched $75 million of 20-year convertible notes talked to yield 3.25% to 3.75% with a 35% to 40% initial conversion premium Monday. The notes are to be sold on swap with $32 million of proceeds earmarked to buy back stock from note buyers.

UBS Investment Bank and CIBC World Markets Inc. are joint bookrunners on the Rule 144A deal, which is slated to price after the market closes Thursday.

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

The deal includes full dividend and takeover protection for holders.

A $15 million greenshoe is available.

Isolagen plans to use $39 million of proceeds for working capital, capital expenditures and general corporate purposes. In addition, Isolagen intends to use proceeds to purchase, at a discount, up to 2 million shares of its common stock from insiders, affiliates and founders of the company.

Houston-based Isolagen is a biotech concern that specializes in the development and commercialization of autologous cellular therapies for soft and hard tissue regeneration.

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