Alliance Data greenshoe exercised, lifting 4.75% notes to $345 million

By Devika Patel

Knoxville, Tenn., June 9 - Underwriters for Alliance Data Systems Corp.'s offering of 4.75% five-year senior unsecured convertible notes exercised their over-allotment option in full for $45 million more of the notes, increasing the size of the issue to $345 million, according to an 8-K filed Tuesday with the Securities and Exchange Commission.

As previously reported, the company sold the notes at par on May 27, after the close, in a Rule 144A offering via bookrunners Barclays Capital Inc., J.P. Morgan Securities Inc. and Bank of America-Merrill Lynch.

The notes have a conversion premium of 18% and a conversion ratio of 21.0235, which equals a conversion price of $47.57.

Proceeds and related warrant transactions will be used to buy back about $74.9 million of Alliance common stock, to pay for about $44.1 million in costs for convertible note hedge transactions and for general corporate purposes, which may include repaying outstanding revolving debt.

Alliance is a Dallas-based marketing services company.

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