By Kenneth Lim
Boston, May 11 - Merix Corp. on Thursday priced $60 million of seven-year convertible senior subordinated notes at a coupon of 4% with an initial conversion premium of 12.5%, cheaper than talked, market sources said.
Price talk guided for a coupon of 3.5% to 4% and an initial conversion premium of 15% to 20%. A syndicate source said the lower premium was because "the stock had run up considerably in the past few days and the company was willing to give some concessions back."
Merix stock closed at $11.63 on Thursday after the deal was announced, lower by 13.85% or $1.87.
Thomas Weisel Partners was the bookrunner of the Rule 144A deal.
The convertibles are non-callable for the first four years, after which they may be called subject to a 150% price hurdle.
The convertibles have dividend and takeover protection.
Merix is a Forest Grove, Ore.-based maker of printed circuit boards. It will use the proceeds of the deal to retire its outstanding $25 million of 6.5% convertible debentures due May 2007 and $30 million of bank debt. Any remaining proceeds will be used to further reduce debt and for corporate purposes.
| Issuer: | Merix Corp.
|
| Issue: | Convertible senior subordinated notes
|
| Bookrunner: | Thomas Weisel Partners
|
| Amount: | $60 million
|
| Greenshoe: | $10 million
|
| Maturity: | May 16, 2013
|
| Coupon: | 4%
|
| Price: | Par
|
| Yield: | 4%
|
| Conversion premium: | 12.5%
|
| Conversion price: | $15.19
|
| Conversion ratio: | 65.8328
|
| Dividend protection: | Yes
|
| Takeover protection: | Yes
|
| Call protection: | Non-callable 4 years, then callable subject to 150% threshold
|
| Price talk: | 3.5%-4%, up 15%-20%
|
| Pricing date: | May 11
|
| Settlement date: | May 16
|
| Distribution: | Rule 144A
|
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