By Sara Rosenberg
New York, May 5 - Lazard Ltd. sold $287.5 million of three-year non-callable mandatory convertibles at par of $25 to yield 6.625% with a 20% initial conversion premium via sole bookrunner Goldman Sachs & Co. Inc. and co-managers Citigroup, Lazard, Merrill Lynch, Morgan Stanley, Credit Suisse First Boston and JPMorgan.
The deal was upsized by $37.5 million from $250 million but the $37.5 million greenshoe was eliminated, so overall the amount sold essentially stayed the same.
The deal priced closer to the wide end of dividend price talk of 6.25% to 6.75% and at the cheap end of premium guidance of 20% to 24%.
Concurrently, the French investment banking house, which was previously a privately held partnership run by Bruce Wasserstein, sold approximately 34 million shares of common stock at $25.00 per share in an initial public offering.
In addition to the IPO, Lazard is issuing a $150 million exchangeable with terms mirroring the mandatory and $50 million of common stock to French bank Ixis.
Wasserstein plans to use proceeds of the Lazard offering to buy out the 36% stake in the firm owned by Lazard chairman Michel David-Weill and his allies, including the French investment firm Eurazeo SA. David-Weill in October demanded that Wasserstein pay him and allies $1.62 billion in cash for their controlling stake.
| Issuer: | Lazard Ltd.
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| Issue: | Mandatory convertible equity security units
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| Bookrunner: | Goldman Sachs & Co. Inc.
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| Co-managers: | Citigroup, Lazard, Merrill Lynch, Morgan Stanley, CSFB, JPMorgan
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| Amount: | $287.5 million
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| Maturity: | May 15, 2008
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| Dividend: | 6.625%
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| Price: | Par, $25
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| Yield: | 6.625%
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| Conversion premium: | 20%
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| Conversion price: | $30/$25
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| Conversion ratio: | 0.8333/1
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| Takeover protection: | Early conversion
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| Dividend protection | Yes
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| Call: | Non-callable
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| Price talk: | 6.25-6.75%, up 20-24%
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| Pricing date: | May 4, after market close
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| Settlement date: | May 10
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| Distribution: | Registered
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