SunEdison to price $350 million 7.25-year convertibles to yield 2.125%-2.625%, up 32.5%-37.5%

By Rebecca Melvin

New York, Jan. 20 – SunEdison Inc. launched an offering of $350 million of 7.25-year convertible senior notes after the market close Tuesday that were expected to price late Wednesday.

The notes were talked to yield 2.125% to 2.625% with an initial conversion premium of 32.5% to 37.5%, according to market sources.

The Rule 144A deal has a $52.5 million greenshoe and was to be sold via joint bookrunners Goldman Sachs & Co., Barclays, Macquarie Capital (USA) Inc. and Morgan Stanley & Co. LLC.

The notes are non-callable, and the deal is coming with a call spread.

There is takeover protection and full dividend protection in the form of a conversion rate adjustment.

Proceeds will be used to fund a portion of the company’s acquisition of First Wind Holdings LLC and about $119.1 million to repay all or a portion of the debt incurred to purchase 1.6 GW of production tax credit qualified turbines.

Remaining proceeds will be used to fund working capital, to accelerate growth of the business and for other general corporate purposes and to fund the cost of capped call transactions.

In connection with the pricing of the notes, the company plans to enter into capped call transactions with counterparties that may include the initial purchasers.

St. Peters, Mo.-based SunEdison develops, makes and sells silicon wafers.

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