WebMD to price $300 million five-year convertibles at 2.25%, up 28%

By Rebecca Melvin

New York, March 8 - WebMD Corp. planned to price $300 million of five-year convertible senior notes before the market open Wednesday that were talked to yield 2.25% with an initial conversion premium of 28%, according to a syndicate source.

The Rule 144A offering was being sold via Citigroup Global Markets Inc. as the bookrunner.

There is a $50 million greenshoe.

The notes, which will mature March 31, 2016, have no calls or puts.

Up to $50 million of proceeds will be used to repurchase shares of common stock with the remainder earmarked for general corporate purposes, including acquisitions, repurchases of its common stock and for working capital.

WebMD priced a similarly structured convertible in early January. That paper was $350 million of 2.5% seven-year convertibles that priced at 99 with an initial conversion premium of 27%.

Elmwood Park, N.J.-based WebMD is a provider of health information services.

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