OSI Pharmaceuticals buys back $37.9 million 3.25% convertibles

By Jennifer Chiou

New York, May 8 - OSI Pharmaceuticals, Inc. repurchased $13 million of its $150 million of 3.25% convertible senior subordinated notes due 2023 in March and $24.9 million of the notes in April, according to a 10-Q filing with the Securities Exchange Commission.

In March, the company said it paid a premium of $244,000 over par for the notes.

The Melville, N.Y., pharmaceutical company said that noteholders have the right to put back the notes in September.

OSI said that $112.1 million of the 3.25% convertibles remains outstanding.

The company said that it anticipates funding the potential redemption of the notes from its current cash position. As of March 31, cash and investments, including restricted securities, were $441.4 million, compared with $305.1 million at Dec. 31.

OSI added that the increase of $136.3 million was primarily due to the issue of $200 million of convertible senior subordinated notes due 2038 and $27.6 million of cash flow from operations, partially offset by amounts used for repurchases.

On Jan. 9, the company issued the 2038 notes and received net proceeds of about $193 million.

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