Exelixis plans to price $225 million seven-year convertibles to yield 3.75%-4.25%, up 25%-30%

By Rebecca Melvin

New York, Aug. 6 - Exelixis Inc. plans to price $225 million of seven-year convertible senior notes after the market close Wednesday that were being talked to yield 3.75% to 4.25% with an initial conversion premium of 25% to 30%, according to a syndicate source on Monday.

There is $33.75 million greenshoe for the registered offering that was being sold via bookrunner Goldman Sachs & Co.

Cowen and Co. is a joint lead manager, and co-managers are Citigroup Global Markets Inc., Credit Suisse Securities (USA) Inc. and Morgan Stanley & Co. LLC.

Concurrently with the note sale, the company is offering 20 million shares of common stock, or 24 million shares if the over-allotment option is exercised.

The notes are non-callable until Aug. 15, 2016, and there is a takeover put. There is contingent conversion at a price hurdle of 130%.

Exelixis is a South San Francisco, Calif.-based biotechnology company developing small molecule therapies for the treatment of cancer.

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