Microchip launches $900 million convertible debentures due 2037, talked at 2.125%-2.625%, up 10%-15%

By Evan Weinberger

New York, Dec. 3 - Microchip Technology Inc. launched $900 million in convertible junior subordinated debentures due 2037 talked at a 2.125% to 2.625% coupon with a 10% to 15% initial conversion premium Monday before the market open.

The deal was expected to price Monday after market close.

JPMorgan is the bookrunner on the Rule 144A transaction. There is a $100 million over-allotment option.

There is a provisional call after 10 years subject to a 150% hurdle. Talk includes protection for payment of any dividend.

Microchip Technology is a Chandler, Ariz.-based semiconductor producer. The company plans to use $625 million of the proceeds to repurchase shares of its common stock. The rest of the proceeds will go toward future stock repurchases and general corporate purposes.

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