Parker Drilling greenshoe fully exercised, pushing 2.125% convertibles to $125 million

By Jennifer Chiou

New York, July 5 - Parker Drilling Co. said that its $10 million over-allotment option was exercised in full, increasing its issue of 2.125% convertible senior notes due July 15, 2012 to $125 million.

After the close on June 28, the company priced $115 million of the convertibles with an initial conversion premium of 32.5%.

As already reported, the notes came in at the cheap end of talk, which had pegged the yield at 1.625% to 2.125% and the initial conversion premium at 32.5% to 37.5%.

The conversion price is $13.85, and the conversion ratio is 72.2217.

Banc of America LLC is the bookrunner for the off-the-shelf sale. Deutsche Bank Securities and Lehman Brothers were co-managers.

There are no call or put options.

Parker Drilling previously said it intends to use the proceeds to redeem all of its outstanding senior floating-rate notes due 2010. The company will also use a portion of the proceeds to pay the net cost of convertible hedge and warrant transactions, which Parker Drilling said will ease the dilution of the company's stock and increase the conversion price.

Parker Drilling is a Houston-based oil and gas drilling contractor.

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