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Omnicare adjusts terms of convertibles following acquisition by CVS
By Angela McDaniels
Tacoma, Wash., Aug. 18 – Omnicare, Inc.’s convertible debentures and notes are convertible into cash rather than Omnicare shares now that the company has been acquired by CVS Health Corp. and delisted from the New York Stock Exchange, according to an 8-K filing with the Securities and Exchange Commission.
The debentures and notes are now convertible into the amount of cash that the holders would have received had they converted just prior to the merger. CVS paid $98 per share for Omnicare. The acquisition closed Tuesday.
The change affects the company’s 4% junior subordinated convertible debentures due 2033, series B 4% junior subordinated convertible debentures due 2033, 3.75% convertible senior subordinated notes due 2025, 3.5% convertible senior subordinated notes due 2044, 3.25% convertible senior debentures due 2035 and 3.25% convertible senior exchange debentures due 2035.
In addition, the company adjusted the conversion rates of the 3.75% convertibles, the 3.5% convertibles and both series of the 3.25% convertibles, according to a company news release.
Effective Aug. 18, the adjusted conversion rate is 37.7191 shares for the 3.75% convertibles, 14.3863 shares for the 3.5% convertibles and 13.0483 shares for both series of 3.25% convertibles, in each case per $1,000 principal amount of notes – provided that the conversion rate for conversions made in connection with the CVS acquisition is 15.2307 shares for the 3.5% convertibles and 13.1278 shares for the 3.25% convertibles.
The conversion rates were initially adjusted in connection with the company’s regular quarterly dividend payments.
Omnicare provides pharmaceutical services and is based in Cincinnati. It is now a wholly owned subsidiary of CVS, a Woonsocket, R.I., operator of drugstores and medical clinics and provider of pharmacy benefits management and specialty pharmacy services.
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