Dynegy $175 million convertible talked to yield 3.25-3.75%, up 30-35%

By Ronda Fears

Nashville, July 29 - Energy concern Dynegy Inc. launched $175 million of 20-year convertible notes talked to yield 3.25% to 3.75% with a 30% to 35% initial conversion premium. It was less than $300 million discussed by the company two weeks ago, as the market expected following the upsizing of its concurrent junk bond deal to $1.325 billion from $1.2 billion on Monday.

Credit Suisse First Boston and Morgan Stanley are joint bookrunners of the Rule 144A deal, which is slated to price after the market close Thursday.

The senior notes will be non-callable for seven years, with puts in years 10 and 15.

There is a $25 million greenshoe available.

Proceeds will be used for the Houston company's refinancing.

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