By Ronda Fears
Nashville, June 10 - Omnicare Capital Trust sold an upsized $300 million of 30-year convertible trust preferreds linked to Omnicare Inc. stock at par of 50 to yield 4.0% with a 40% initial conversion premium.
Lehman Brothers and Wachovia Securities, Inc. were joint bookrunning lead managers of the deal.
The deal was upsized from $250 million and sold at the tight end of yield talk for a 4.0% to 4.5% dividend. It sold aggressively outside premium guidance of 30% to 35%.
The convert is part of a refinancing plan, which also includes a new four-year credit facility consisting of a $250 million term loan and a $500 million revolving credit facility, an offering of 5.625 million shares of common stock at $29.16 per share and an offering of $250 million 10-year senior notes.
Omnicare said it will use proceeds from the convertible and stock offerings to redeem all its $345 million of 5% convertible subordinated debentures due 2007. Proceeds from the senior notes offering and borrowings of $250 million under the term loan portion of the new credit facility will be used to repay the balance of its existing credit facility of $474 million.
Remaining proceeds will be used for general corporate purposes.
Terms of the deal are:
Issuer: Omnicare Capital Trust
| Issue: | Convertible trust PIERS (preferred income equity redeemable securities)
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| Joint bookrunners: | Lehman Brothers and Wachovia Securities
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| Joint lead managers: | JPMorgan, SunTrust Robinson Humphrey and UBS Warburg
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| Co-managers: | CIBC World Markets, Bear Stearns & Co. Inc. and Thomas Weisel Partners LLC
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| Amount | $300 million, up from $250 million
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| Greenshoe: | $45 million, up from $37.5 million
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| Maturity: | June 15, 2033
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| Dividend: | 4.0%
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| Price: | par, $50
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| Yield: | 4.0%
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| Conversion premium: | 40%
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| Conversion price: | $40.824
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| Conversion ratio: | 1.2248
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| Call: | Non-callable for 6 years
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| Contingent conversion: | 130%
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| Pricing date: | June 9
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| Settlement: | June 13
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