Wachovia to sell enhanced yield securities linked to Peabody Energy

By Jennifer Chiou

New York, Sept. 1 - Wachovia Corp. plans to offer notes in the enhanced yield securities structure linked to Peabody Energy Corp. stock, according to a 424B5 filing with the Securities and Exchange Commission.

The securities will mature on Oct. 1, 2007.

Interest will be payable quarterly and will be between 12.5% and 13.5%, to be determined at pricing.

Payout at maturity will be par unless Peabody Energy stock falls below the knock-in price during the life of the securities and finishes below its initial price, in which case noteholders will receive a number of Peabody Energy shares equal to $1,000 divided by the initial stock price.

The knock-in price will be 70% of the initial stock price.

Wachovia Securities will be the underwriter.

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