By Rebecca Melvin
New York, Dec. 3 - Orexigen Therapeutics Inc. priced $100 million of seven-year convertible senior notes late Monday at par to yield 2.75% with an initial conversion premium of 32.5%, according to a syndicate source.
The Rule 144A deal priced at the tight end of talk, which was for a 2.75% to 3.25% coupon and a 27.5% to 32.5% premium.
There is a $15 million greenshoe.
The deal was brought by joint bookrunners BofA Merrill Lynch, Credit Suisse Securities (USA) LLC and Leerink Swann.
The notes have contingent conversion if shares rise to 130% of the conversion price, and they will be net share settled.
The securities are also non-callable for life and have dividend protection via a conversion ratio adjustment and a make-whole adjustment premium in the event of a change of control.
Proceeds will be used for working capital and other general corporate purposes. A portion of the proceeds may also be used to acquire new businesses or products.
San Diego-based Orexigen is a biopharmaceutical company focused on development of treatments of obesity.
| Issuer: | Orexigen Therapeutics Inc.
|
| Issue: | Convertible senior notes
|
| Amount: | $100 million
|
| Greenshoe: | $15 million
|
| Maturity: | Dec. 1, 2020
|
| Bookrunners: | BofA Merrill Lynch, Credit Suisse Securities (USA) LLC, Leerink Swann
|
| Co-manager: | Piper Jaffray & Co.
|
| Coupon: | 2.75%
|
| Price: | Par
|
| Yield: | 2.75%
|
| Conversion premium: | 32.5%
|
| Conversion price: | $8.19
|
| Conversion ratio: | 122.1225 shares
|
| Contingent conversion: | Yes, at 130%
|
| Net share settlement: | Yes
|
| Calls: | Non-callable
|
| Puts: | No puts
|
| Dividend protection: | Yes
|
| Takeover protection: | Yes
|
| Price talk: | 2.75%-3.25%, up 27.5%-32.5%
|
| Pricing date: | Dec. 2
|
| Settlement date: | Dec. 6
|
| Stock symbol: | Nasdaq: OREX
|
| Stock reference price: | $6.18 at close Dec. 2
|
| Distribution: | Rule 144A
|
| Market capitalization: | $626.5 million
|
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