AMAG offers $250 million five-year convertible notes at 2.75%-3.25% yield, up 37.5%-42.5%

By Stephanie N. Rotondo

Seattle, May 3 – AMAG Pharmaceuticals Inc. is offering $250 million of five-year convertible senior notes, the company said in a prospectus filed with the Securities and Exchange Commission on Wednesday.

Price talk is for a 2.75% to 3.25% yield and an initial conversion premium of 37.5% to 42.5%, according to a market source.

J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC are the joint bookrunners.

There is a $37.5 million over-allotment option.

Prior to March 1, 2022, the notes are contingently convertible. After that date, the notes can be converted at any time.

Conversions will be settled in cash, stock or a combination.

The notes are non-callable for life and are putable only upon a fundamental change.

Proceeds will be used, along with cash on hand, to repay and terminate the company’s 2015 term loan facility.

Alongside the convertible debt sale, the company may enter into privately negotiated transactions to purchase its 2019 notes. Such transactions will be funded with cash on hand.

AMAG is a Waltham, Mass.-based biopharmaceutical company.

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