New Issue: Durect $50 million convertibles yield 6.25%, up 25%

By Ronda Fears

Nashville, June 13 - Durect Corp. sold $50 million of five-year non-callable convertible notes at par to yield 6.25% with a 25% initial conversion premium.

The Rule 144A deal, via Morgan Stanley, sold at the wide end of yield talk of 5.75% to 6.25% and cheaply outside of premium guidance of 35% to 40%.

The Cupertino, Calif.-based biotech firm said it would use proceeds to fund the research, development, manufacture and commercialization of existing and future products and for general corporate purposes.

Terms of the deal are:

Issuer: Durect Corp.

Issue:	Convertible subordinated notes
Lead manager:	Morgan Stanley
Amount	$50 million
Greenshoe:	$10 million
Maturity:	June 15, 2008
Coupon:	6.25%
Price:	Par
Yield:	6.25%
Conversion premium:	25%
Conversion price:	$3.15
Conversion ratio:	996.85
Call:	Non-callable
Price talk:	5.75-6.25%, up 35-40%
Distribution:	Rule 144A
Pricing date:	June 12 after close
Settlement:	June 18

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