Ivax $350 million overnight convertible talked at 1.0-1.5% yield, 25-30% premium

By Ronda Fears

Nashville, Feb. 26 - Ivax Corp. launched $350 million of 20-year convertible notes in the overnight market talked to yield 1.0% to 1.5% with a 25% to 30% initial conversion premium.

UBS Investment Bank is sole bookrunner of the Rule 144A deal, which is scheduled to price before Friday's open.

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

The Miami-based generic drugmaker said proceeds would be used for general corporate purposes, including the potential redemption of subordinated notes.

Ivax's 4.5% convertible due 2008, a $750 million issue, is callable May 29 at 102.57. It was quoted Thursday at 101.125 bid, 102.125 offered.

Ivax shares closed Thursday up 15 cents, or 0.64%, to $23.70. In after-hours trading, the stock was down 55 cents, or 2.32%.

Last week, Ivax reported fourth quarter net revenues of $399 million, the highest quarterly revenues in its history, a 23% increase from $325.2 million in fourth quarter 2002. But net income declined to $29.3 million, or 15 cents a share, compared to $36.8 million, or 19 cents a share, in fourth quarter 2002.

Ivax said the decline in fourth quarter profits was due to receiving a $20 million payment under a collaboration agreement in the 2002 period.

For 2003, the company recorded net revenues of $1.42 billion, also a record, up 19% from $1.2 billion in 2002. Net income was $121.3 million, or 61 cents per share, versus $122.8 million, or 62 cents a share, in 2002. Profits in 2003 included income from discontinued operations of $22.2 million, or 11 cents per share.

Ivax expects earnings per share in 2004 to meet or exceed 89 cents.

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