By Rebecca Melvin
New York, May 7 – Anthem Inc. priced an upsized $1,175,000,000 of convertible equity units at $50 each after the market close Wednesday to yield 5.25% with an initial conversion premium of 30%, according to market sources.
The registered off-the-shelf deal was initially talked at $900 million. There is a $75 million greenshoe, which was downsized from $135 million.
Pricing came at the rich end of talked terms, which was for a 5.25% to 5.75% yield and 25% to 30% premium.
Credit Suisse Securities (USA) LLC and BofA Merrill Lynch were joint bookrunners of the offering.
The units are non-callable and mature in three years. They have full dividend protection via a conversion rate adjustment above $0.625 per quarter. There is a takeout put, including make-whole shares.
Proceeds are expected to be used for general corporate purposes, including repurchase of a portion of Anthem’s outstanding 2.75% convertibles.
Indianapolis-based Anthem is a health benefits company.
| Issuer: | Anthem Inc.
|
| Issue: | Mandatory convertible equity units
|
| Amount: | $1.175 billion (23.5 million units), upsized from $900 million (18 million units)
|
| Greenshoe: | $75 million (1.5 million units), downsized from $135 million
|
| Maturity: | May 1, 2018
|
| Bookrunners: | Credit Suisse Securities (USA) LLC, BofA Merrill Lynch
|
| Distribution rate: | 5.25%
|
| Price: | $50.00 par
|
| Premium: | 30%
|
| Threshold appreciation price: | $207.81
|
| Minimum settlement rate: | 0.2406 shares
|
| Maximum settlement rate: | 0.3475 shares
|
| Price talk: | 5.25%-5.75%, up 25%-30%
|
| Pricing date: | May 6
|
| Settlement date: | May 12
|
| Stock symbol: | Nasdaq: ANTM
|
| Equity unit symbol: | Nasdaq: ANTX
|
| Stock reference price: | $159.85 as of close May 6
|
| Market capitalization: | $41.86 billion
|
| Distribution: | Registered, off the shelf
|
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