By Rebecca Melvin
New York, May 11 - Medicis Pharmaceutical Corp. priced an upsized $450 million of five-year convertible senior notes after the close on Thursday at par to yield 1.375% with an initial conversion premium of 25%, according to syndicate source.
The registered deal was originally talked at $400 million in size, and pricing came toward the cheap end of revised coupon talk of 1% to 1.5% and at the revised price point for the premium.
Talk was tightened up beyond original talk of 1.5% to 2% for the coupon and toward the tight, or rich, end of 20% to 25% premium talk.
Deutsche Bank Securities Inc. and J.P. Morgan Securities LLC were the joint bookrunners of the deal, for which there is a $50 million greenshoe.
The notes are non-callable with no puts.
There is net share settlement and dividend protection via a conversion rate adjustment.
Proceeds are intended for general corporate purposes, which may include working capital, capital expenditures, repurchasing shares of common stock, repaying outstanding debt and corporate acquisitions.
In addition, the company entered into convertible note hedge and warrant transactions for which $40 million of proceeds from the note and warrant sales will go to fund the hedge transactions.
The effective premium from the issuer's perspective related to the hedge transactions was not publicly available, the syndicate source said.
Scottsdale, Ariz.-based Medicis is a specialty pharmaceutical company focused on dermatology and aesthetic treatments.
| Issuer: | Medicis Pharmaceutical Corp.
|
| Issue: | Convertible senior notes
|
| Amount: | $450 million, upsized from $400 million
|
| Greenshoe: | $50 million
|
| Maturity: | June 1, 2017
|
| Bookrunners: | Deutsche Bank Securities Inc., J.P. Morgan Securities LLC
|
| Coupon: | 1.375%
|
| Price: | Par
|
| Yield: | 1.375%
|
| Conversion premium: | 25%
|
| Conversion price: | $47.07
|
| Conversion ratio: | 21.2427 shares
|
| Call: | Non-callable
|
| Puts: | No puts
|
| Net share settlement: | Yes
|
| Dividend protection: | Yes
|
| Price talk: | 1%-1.5%, up 25%, revised from 1.5%-2%, up 20%-25%
|
| Call spread: | Yes
|
| Pricing date: | May 10, after the close
|
| Settlement date: | May 16
|
| Distribution: | Registered, off the shelf
|
| Stock reference price: | $37.66 at close May 10
|
| Stock symbol: | NYSE: MRX
|
| Market capitalization: | $2.16 billion
|
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