Leap Wireless talks $200 million of seven-year convertibles at 4.5%-5%, up 72.5%-77.5%

By Kenneth Lim

Boston, June 19 - Leap Wireless International Inc. plans to price $200 million of seven-year convertible senior notes, talked at a coupon of 4.5% to 5% and an initial conversion premium of 72.5% to 77.5%.

The deal will also have warrant coverage with each warrant having a strike price at a 72.5% to 77.5% premium of the underlying shares.

There is an over-allotment option for an additional $30 million.

Goldman Sachs and Morgan Stanley are the bookrunners of the offering, with Citigroup and Deutsche Bank as co-managers. The deal will be distributed under Rule 144A.

There is a concurrent offering of $200 million of senior unsecured notes due 2015.

The convertibles will be non-callable and there are no puts.

Leap Wireless, a San Diego, Calif.-based provider of digital wireless services in the United States under the Cricket and Jump brands, said the proceeds will be used for working capital and other general corporate purposes.

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