By Ronda Fears
Nashville, May 16 - Magma Design Automation Inc. sold $150 million of five-year non-callable 0% convertible subordinated notes at par to yield 0% with a 27.33% initial conversion premium, via bookrunner Credit Suisse First Boston.
The Rule 144A issue, sold on call spread, priced at the cheap end of premium guidance of 27% to 33%.
The Cupertino, Calif., chip design software company said it was hedging the notes with warrants to offset potential dilution from conversion of the notes, up to a market price of $31.50 per share. Also, the company agreed to buy $20 million of stock from convertible purchasers.
Remaining proceeds are earmarked for general corporate purchases, which may include acquisitions.
Terms of the deal are:
Issuer: Magma Design Automation Inc.
| Issue: | Convertible subordinated notes
|
| Lead manager: | Credit Suisse First Boston
|
| Amount | $150 million
|
| Greenshoe: | $30 million
|
| Maturity: | May 22, 2008
|
| Coupon: | 0%
|
| Price: | Par
|
| Yield: | 0%
|
| Conversion premium: | 27.33%
|
| Conversion price: | $22.86
|
| Conversion ratio: | 43.4775
|
| Call: | Non-callable
|
| Settlement: | May 22
|
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