Alloy $60 million convert talked at 4.875-5.375% yield, up 25-30%

By Ronda Fears

Nashville, July 14 - Alloy Inc. launched $60 million of 20-year convertible notes talked to yield 4.875% to 5.375% coupon with a 25% to 30% initial conversion premium.

Lehman Brothers is lead manager of the Rule 144A deal, which is scheduled to price after the close Thursday.

The senior debentures will be non-callable for five years, with puts in years five, 10 and 15.

There also is a 110% contingent conversion trigger.

Holders will have dividend protection through conversion ratio adjustment.

There is a $12 million greenshoe available.

The marketing company said it would use a signification portion of proceeds for acquisitions, potentially in both merchandising and sponsorship businesses, and for working capital, capital expenditures and general corporate purposes.

Alloy shares closed up 23c, or 3%, to $7.95.

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