AmSurg to price $125 million mandatory convertibles to yield 5.25%-5.75%, up 17.5%-22.5%

By Rebecca Melvin

New York, June 23 – AmSurg Corp. plans to price $125 million of mandatory convertible preferred shares or 1.25 million shares at $100 each, after the market close on Thursday that were being talked to yield 5.25% to 5.75% with an initial conversion premium of 17.5% to 22.5%, according to a syndicate source.

The registered mandatory deal is coming concurrently with a common stock offering of 8.5 million shares. The offerings are not contingent on each other or upon the consummation of the recently announced transaction between AmSurg and Sheridan Healthcare Inc.

The mandatory deal has a greenshoe for up to an additional $18.75 million of shares.

Proceeds from the offerings, together with shares of stock to be issued in the Sheridan Transaction, additional debt financing and cash on hand will be used to finance the Sheridan Transaction as well as to repay borrowings under AmSurg’s existing credit facility, to repay the outstanding balance on its senior secured notes due 2020 and to pay fees and expenses related to the Sheridan Transaction.

Citigroup Global Markets Inc., SunTrust Robinson Humphrey Inc., Barclays, Deutsche Bank Securities Inc., Goldman Sachs & Co., J.P. Morgan Securities LLC and Raymond James are the joint bookrunning managers for the common stock and mandatory offerings.

Co-managers are BMO Capital Markets, Piper Jaffray & Co. and Cantor Fitzgerald & Co.

Nashville, Tenn.-based AmSurg acquires, develops and operates ambulatory surgery centers.

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