National Financial Partners plans $200 million five-year convertibles, talked at 0.25%-0.75%, up 20%-25%

By Kenneth Lim

Boston, Jan. 16 - National Financial Partners Corp. plans to price $200 million of five-year convertible senior notes on Wednesday after the market closes, talked at a coupon of 0.25% to 0.75% and an initial conversion premium of 20% to 25%.

The notes will be offered at par.

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

Goldman Sachs and UBS Investment Bank are the bookrunners of the registered off-the-shelf offering.

Some National Financial Partners common stockholders will concurrently sell 1.6 million common shares. The company will not receive any of the proceeds from that stock sale.

The notes will be non-callable. There are no puts.

There will be a contingent conversion hurdle at 130% of the conversion price.

The notes will have dividend protection for quarterly common dividends above 18 cents per share. Takeover protection is in the form of a change-of-control put and a make-whole premium.

There is a net-share settlement feature.

National Financial Partners, a New York-based financial services provider, said it will use the proceeds of the deal to buy back about 2 million shares of its common stock from Apollo Investment Fund IV LP and Apollo Overseas Partners IV LP. The proceeds will also fund convertible note hedge and warrant transactions and pay down existing debt.

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