By Rebecca Melvin
New York, Aug. 14 - Ferro Corp. priced $150 million of five-year convertible senior notes after the market close Wednesday at par to yield 6.5% with an initial conversion premium of 60%, according to a news release.
The registered deal priced at the cheap end of talk, which was for a coupon of 6% to 6.5% and an initial conversion premium of 60% to 65%.
There is a greenshoe of 15%, or $22.5 million.
Citigroup Global Markets, Credit Suisse Securities and J.P. Morgan Securities Inc. were joint bookrunners of the registered shelf offering.
The bonds are non-callable for life, and there are no puts, except for a fundamental change-of-control put.
The bonds will have dividend protection in the form of a standard conversion ratio adjustment. There is also contingent conversion at a stock price trigger of 130% and a parity trigger of 97%.
In addition, if the company's stock exceeds the conversion price during an averaging period, holders will receive up to an additional 18.5552 shares, with the exact amount to be set by a formula.
Proceeds will be used to purchase or redeem all of the company's outstanding 9.125% senior notes due 2009, to pay accrued and unpaid interest, to pay all premiums and transaction expenses and for general corporate purposes.
The tender offer and consent solicitation in connection with the purchase of the 9.125% senior notes is expected to occur on the Aug. 19 date set for the closing of the offering.
Ferro is a Cleveland-based supplier of specialty materials and chemicals for makers of electronics, solar energy, telecom, pharmaceutical, building, automotive and other household and industrial products.
| Issuer: | Ferro Corp.
|
| Issue: | Convertible senior notes
|
| Amount: | $150 million
|
| Greenshoe: | $22.5 million
|
| Maturity: | Aug. 15, 2013
|
| Bookrunners: | Citigroup Global Markets, Credit Suisse Securities and J.P. Morgan Securities Inc.
|
| Coupon: | 6.5%
|
| Price: | Par
|
| Yield: | 6.5%
|
| Conversion premium: | 60%
|
| Conversion ratio: | 30.9253
|
| Conversion price: | $32.34
|
| Price talk: | 6%-6.5%, up 60%-65%
|
| Call: | Non-callable for life
|
| Takeover protection: | Yes
|
| Dividend protection: | Yes
|
| Contingent conversion: | Yes, at 130%
|
| Net share settlement: | Yes
|
| Pricing date: | Aug. 13
|
| Settlement date: | Aug. 19
|
| Distribution: | Registered, shelf
|
| Stock symbol: | NYSE: FOE
|
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