By Rebecca Melvin
Princeton, N.J., June 23 - MedImmune Inc. priced $1 billion of convertible bonds in two parts at the cheap end of talk for the coupon but at the midpoint of talk for the initial conversion premium, according to syndicate source.
MedImmune sold $500 million of five-year convertible senior notes at par to yield 1.375% with an initial conversion premium of 22.5%. The issuer sold $500 million of seven-year convertible senior notes at par to yield 1.625% with an initial conversion premium of 22.5% as well.
Price talk on the five-year tranche was for a coupon of 0.875% to 1.375% with an initial conversion premium of 20% to 25%; while talk on the seven-year tranche was for a coupon of 1.125% to 1.625% with an initial conversion premium in the same range.
Pricing occurred late Thursday.
The Rule 144A deal was sold via joint bookrunners Merrill Lynch and UBS Investment Bank, with UBS stabilizing.
Neither tranche has any calls or puts.
There is a planned over-allotment option for up to an additional $75 million for each tranche.
Half of proceeds will to go to repurchase MedImmune's existing 1% convertible senior notes on July 17. MedImmune also expects to use up to $150 million to buy back stock concurrently with the offering of notes.
The company also plans to enter into convertible note hedge transactions with certain initial purchasers, the effect of which will be to raise the conversion price of the notes to about $47.67, or a 75% premium, from the company's perspective.
Remaining proceeds will be added to working capital and used for general corporate purposes.
Gaithersburg, Md.-based MedImmune (Nasdaq: MEDI) is a biotechnology company focused on the treatment of infectious and inflammatory diseases and cancer.
| Issuer: | MedImmune Inc.
|
| Issue: | Convertible senior notes
|
| Bookrunners: | Merrill Lynch and UBS Investment Bank
|
| Amount: | $1 billion, in two $500 million tranches
|
| Greenshoe: | $150 million, or $75 million per tranche
|
| Pricing date: | June 22, after the close
|
| Settlement date: | June 28
|
| Distribution: | Rule 144A
|
|
|
| Five-year notes
|
| Amount: | $500 million
|
| Maturity: | July 15, 2011
|
| Coupon: | 1.375%
|
| Price: | Par
|
| Yield: | 1.375%
|
| Conversion premium: | 22.5%
|
| Conversion price: | $33.37
|
| Conversion ratio: | 29.9679
|
| Calls: | Non-call for life
|
| Puts: | No puts
|
| Price talk: | 0.875%-1.375%, up 20%-25%
|
|
|
| Seven-year notes
|
| Amount: | $500 million
|
| Maturity: | July 15, 2013
|
| Coupon: | 1.625%
|
| Price: | Par
|
| Yield | 1.625%
|
| Conversion premium: | 22.5%
|
| Conversion price: | $33.37
|
| Conversion ratio: | 29.9679
|
| Calls: | Non-call for life
|
| Puts: | No puts
|
| Price talk: | 1.125%-1.625%, up 20%-25%
|
|
|
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