Phoenix $125 million mandatory convertibles talked at 7-7.5% yield, 18-22% premium

By Sara Rosenberg

New York, Oct. 31 - Price talk emerged Thursday on The Phoenix Cos. Inc./Hilb, Rogal & Hamilton's $125 million of three-year mandatory convertibles sale. The yield is talked in the 7% to 7.5% range and the initial conversion premium is now being talked in the 18% to 22% range, according to market sources.

The registered deal is expected to price on Nov. 7 via lead managers Banc of America Securities, Merrill Lynch & Co. and Morgan Stanley.

The issue price is expected to be the same as where the common stock is trading.

There is no greenshoe on the deal.

Moody's Investors Service rates the deal Baa2 and Standard and Poor's rates the deal BBB+.

There will also be a secondary stock offering of 1.7 million shares of Hilb, Rogal & Hamilton with 1.135 million from the company and 567,000 shares from Phoenix.

Proceeds of the stock offering will be used to repay debt, for acquisitions and other general corporate purposes, including working capital and capital expenditures.

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