By Peter Heap
New York, Nov. 2 - King Pharmaceuticals, Inc. said it priced $300 million of convertible debentures to yield 2.75% with an initial conversion premium of 32%.
The Rule 144A offering priced at the rich end of talk, which had put the yield at 2.75% to 3.25% and the conversion premium at 28% to 32%.
Simultaneous with the convertible sale, the Bristol, Tenn. pharmaceutical company also sold 20.5 million shares of common stock, 16.5 million offered by the company and 4.5 million by company executives. The stock priced at $38.00 per share and there is a 3.075 million share greenshoe.
Bookrunners for both offerings were Credit Suisse First Boston, JPMorgan, Banc of America Securities LLC and UBS Warburg.
Proceeds from the convertibles will be used for general corporate purposes, King said.
Details of the convertibles are as follows:
| Amount: | $300 million
|
| Greenshoe: | $45 million
|
| Maturity: | Nov. 15, 2021
|
| Coupon: | 2¾%
|
| Price: | Par
|
| Yield: | 2.75%
|
| Initial conversion premium: | 32% (based on $38.00 stock price)
|
| Conversion price: | $50.16
|
| Conversion ratio: | 19.9362
|
| Call: | Non-callable for five years
|
| Puts: | In years five, 10 and 15
|
| Contingent conversion threshold: | 110%
|
| Contingent payment threshold: | 120%
|
| Settlement: | Nov. 7 flat
|
| Ratings: | Moody's: | Ba1
|
| S&P: | BB
|
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| End
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