Four greenshoes add another $155 million to issuance

By Peter Heap

New York, May 23 - Total convertible issuance for May jumped another $155 million on Friday as four companies announced that underwriters had exercised the greenshoe on their recent new deals.

The additions take the month's total volume of new deals to $10.5 billion and the year-to-date tally to $35.96 billion (both figures are for dollar-denominated deals offered in the U.S. and include securities issued by investment banks and convertibles into another company's stock).

Issuance for the week of May 19 ended at $2.63 billion.

Biggest of the greenshoes exercised was Comverse Technology, Inc.'s $70 million.

The company said underwriters of its recent sale of zero-yield putable securities due 2023 exercised the $70 million over-allotment option in full, raising the size of the deal to $420 million.

The Woodbury, N.Y. provider of computer and telecommunications systems and software originally sold $350 million of the convertibles after the market close on May 1 to yield 0% with a 37% initial conversion premium.

Lehman Brothers was the lead manager on the Rule 144A deal.

Comverse will use proceeds for working capital and other corporate purposes.

Sinclair Broadcast Group, Inc. said underwriters of its recent offering of 4.875% convertible senior subordinated notes due 2018 exercised the $25 million over-allotment option in full, raising the size of the deal to $150 million.

Sinclair originally sold $125 million of the convertibles after the market close on May 14 to yield 4.875% with a 103% initial conversion premium. The deal was upsized from $100 million at pricing.

Joint lead managers for the Rule 144A deal were Bear Stearns & Co. and UBS Warburg.

The Baltimore company said it intends to use proceeds of the offerings, together with available cash on hand and/or bank debt, to finance the repurchase or redemption of its existing 11.625% high yield trust offering preferred securities, or Hytops, due March 15, 2009.

Williams Cos., Inc. said underwriters of its recent offering of 5.5% junior subordinated convertible debentures due 2033 exercised the $25 million over-allotment option in full, raising the size of the deal to $300 million.

Williams originally sold $275 million of the convertibles to yield 5.5% with a 46% initial conversion premium after the market close on May 20.

Lehman Brothers was the lead manager for the Rule 144A deal.

Tulsa, Okla.-based Williams will use proceeds to fund its previously announced repurchase of the convertible preferred stock currently held by a subsidiary of MidAmerican Energy Holdings Co.

And Wilson Greatbatch Technologies, Inc.'s said underwriters of its recent offering of 2.25% convertible subordinated debentures due 2013 exercised the $35 million over-allotment option in full, raising the size of the deal to $170 million.

Wilson Greatbatch originally sold $135 million of the convertibles to yield 2.25% with a 30% initial conversion premium after the market close on May 21.

Morgan Stanley was lead manager for the Rule 144A deal.

The Clarence, N.Y. medical device manufacturer will use proceeds to repay bank debt and for general corporate purposes.

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