Ford talks $2 billion five-year convertibles to yield 0%, up 40%-45%

By Abigail W. Adams

Portland, Me., March 16 – Ford Motor Co. plans to price $2 billion of five-year convertible notes after the market close on Tuesday with price talk for a fixed coupon of 0% and an initial conversion premium of 40% to 45%, according to a market source.

Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC are active bookrunners for the Rule 144A offering, which carries a greenshoe of $300 million.

The notes are non-callable for three years and then subject to a 130% hurdle.

They will be settled in cash, shares or a combination of both at the company’s option.

Proceeds will be used for general corporate purposes, which may include the repayment of debt.

Ford is a Dearborn, Mich.-based car manufacturer.

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