By Kenneth Lim
Boston, March 8 - Albany International Corp. fixed the terms of its $150 million offering of 20-year convertible notes on the cheap end of talk with a coupon of 2.25% and an initial conversion premium of 20%.
Price talk was for a coupon between 1.75% and 2.25% and an initial conversion premium between 20% and 25%.
Bookrunners JP Morgan and Banc of America have a 13-day greenshoe option of $30 million.
The deal will be distributed under Rule 144A.
The securities will mature on March 1, 2026, and are priced at par. Each bond may initially be converted into 22.462 Albany International shares, or an initial conversion price of $44.52 shares.
The convertibles will be non-callable for seven years, with puts in years seven and 15. They also have takeover and dividend protection.
There is also a contingent conversion feature that kicks in when the value of the bond exceeds parity of 103.
Albany, N.Y.-based Albany International will use proceeds from the offering to repurchase the remaining of the 3.5 million of its class A common stock is has not already bought. The company, which announced the share buyback in January, has already repurchased 663,700 shares.
The company will also enter into convertible note hedge and warrant transactions that will give it the option to buy shares and reduce the potential dilution from the conversion of the notes.
Albany International makes consumable parts for paper-making machines and industrial doors.
| Issuer: | Albany International Corp.
|
| Issue: | Convertible senior notes
|
| Bookrunner: | JP Morgan and Banc of America
|
| Amount: | $150 million
|
| Greenshoe: | $30 million
|
| Maturity: | March 1, 2026
|
| Coupon: | 2.25%
|
| Price: | Par
|
| Yield: | 2.25%
|
| Conversion premium: | 20%
|
| Conversion price: | $44.52
|
| Conversion ratio: | 22.462
|
| Contingent conversion: | Parity of 103
|
| Contingent payment: | None
|
| Dividend protection: | Yes
|
| Takeover protection: | Conversion rate adjustment
|
| Call protection: | Non-callable for 7 years
|
| Puts: | Years 7, 15
|
| Price talk: | 1.75%-2.25%, up 20%-25%
|
| Pricing date: | March 7
|
| Settlement: | March 13
|
| Distribution: | Rule 144A
|
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