By Sara Rosenberg
New York, May 5 - Palm Harbor Homes Inc. sold an upsized offering of $65 million of 20-year senior convertible notes at par to yield 3.25% with a 38% initial conversion premium via bookrunner Citigroup Global Markets Inc.
The Rule 144A/Regulation S deal, which was originally expected to be sized at $50 million, priced at the cheap end of talk which put the yield at 2.75% to 3.25% and the initial conversion premium at 38% to 42%.
There is a $10 million greenshoe.
The senior notes are non-callable for seven years with cash puts in years seven, 10 and 15. There also is a 120% contingent conversion trigger.
Dallas-based Palm Harbor Homes, a manufactured home maker, plans to use proceeds for general corporate purposes, including repayment of obligations under the company's floor plan financing.
Terms of the deal are:
| Issuer: | Palm Harbor Homes Inc.
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| Issue: | Convertible senior notes
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| Bookrunner: | Citigroup Global Markets Inc.
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| Amount: | $65 million
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| Greenshoe: | $10 million
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| Maturity: | 2024
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| Coupon: | 3.25%
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| Price: | Par
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| Yield: | 3.25%
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| Conversion premium: | 38%
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| Conversion price: | $25.92
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| Conversion ratio: | 38.5803
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| Call: | Non-callable for seven years
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| Put: | Seven, 10 and 15
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| Contingent conversion: | 120%
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| Price talk: | 2.75% to 3.25% coupon, up 38% to 42%.
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| Pricing date: | May 5, after the close
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| Distribution: | Rule 144A/Regulation S
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