Wright Medical plans $200 million convertibles due 2017 to yield 2.25%-2.75%, up 22.5%-27.5%

By Rebecca Melvin

New York, Aug. 22 - Wright Medical Group Inc. launched an offering of $200 million of convertible notes due 2017 early Wednesday that was seen pricing after the market close. The notes were talked to yield 2.25% to 2.75% with an initial conversion premium of 22.5% to 27.5%, according to a market source.

J.P. Morgan Securities LLC is the bookrunner of the Rule 144A offering for which there is a $30 million greenshoe.

The bonds are non-callable for life with no puts. There is takeover and dividend protection.

The deal will include one or more privately negotiated convertible note hedge transactions as well as warrant transactions.

About $130 million of the proceeds will be used to pay an outstanding term loan under the company's senior credit facility, and a portion of the proceeds will fund the cost of convertible note hedge transactions. The balance of the proceeds will be used to fund up to $30 million of the repurchase of Wright Medical's 2014 convertible senior notes and for general corporate purposes, including acquisitions.

Wright Medical is an Arlington, Tenn.-based orthopedic medical device company.

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