Lennar greenshoe exercised, lifting convertibles to $276.5 million

By Devika Patel

Knoxville, Tenn., May 4 - Underwriters for Lennar Corp.'s offering of 2% 10.5-year convertible senior notes exercised their over-allotment option in part for $26.5 million more of the convertibles, increasing the size of the issue to $276.5 million, the company said in a press release.

As previously reported, the company sold the convertibles at par of $1,000 in a Rule 144A offering on April 27 via joint bookrunners Citigroup Global Markets Inc. and J.P. Morgan Securities Inc. Deutsche Bank Securities Inc. and UBS Securities were the co-managers.

The convertibles have a conversion rate of 36.2837 and an initial conversion premium of 37.5%, which is equal to a conversion price of $27.64 per share.

The convertibles are non-callable until Dec. 1, 2013. There are puts on Dec. 1, 2013 and on Dec. 1, 2015.

There is contingent interest, or 50 basis points subject to a 120% threshold.

Conversion settlement can be made in stock.

Proceeds are for general corporate purposes, which may include repayment or repurchase of existing Lennar senior notes or other debt.

Lennar is a Miami-based homebuilder and provider of financial services.

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