LinkedIn plans $1.5 billion five-year convertibles to yield 0%-0.5%, up 40%-45%

By Rebecca Melvin

New York, Nov. 4 – LinkedIn Corp. launched an offering of $1.5 billion of five-year convertible senior notes after the market close on Tuesday that were seen pricing after the market close on Wednesday.

The notes are talked to yield 0% to 0.5% with an initial conversion premium of 40% to 45%, according to market sources.

The Rule 144A deal has a greenshoe of $172.5 million and is being sold via joint bookrunners Goldman Sachs & Co., J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC. Allen & Co. is a co-manager.

The notes are non-callable with no puts. There is takeover and dividend protection.

In connection with the pricing of the notes, LinkedIn plans to enter into convertible not hedge and warrant transactions, or a call spread, with initial purchasers of the bonds.

Proceeds will be used to pay the net cost of the call spread and for general corporate purposes.

LinkedIn is a business-oriented social networking service based in Mountain View, Calif.

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