Novell $450 million quick-sale convertible talked at 0.5%-1.0% yield, up 36%-40%

Nashville, June 28 - Novell Inc. was in the convertible market Monday pitching $450 million of 20-year senior notes talked to yield 0.5% to 1.0% with a 36% to 40% initial conversion premium.

Up to $125 million of proceeds were earmarked to buy back stock from short sellers participating in the offering.

Citigroup Global Markets Inc. is bookrunner of the Rule 144A deal, which was pricing after the close Monday.

The notes will be non-callable for five years, with puts in years five, 10 and 15. There is a 130% contingent conversion trigger.

Dividend cash takeover protection features are included in the documentation.

A $90 million greenshoe is available.

Proceeds remaining after the stock buybacks would be used for general corporate purposes, including potential future acquisitions, the Waltham, Mass.-based computer networking firm said.

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