Pinnacle Airlines greenshoe exercised, raising convertibles to $121 million

By Caroline Salls

Pittsburgh, Feb. 9 - Pinnacle Airlines Corp. said the underwriters of its recent offering of 3.25% senior convertible notes due 2025 exercised the $11 million over-allotment option in full, raising the size of the deal to $121 million.

The Memphis-based regional feeder to Northwest Airlines Corp. originally priced $110 million of the securities after the close on Feb. 2 to yield 3.25% with a 21.5% initial conversion premium.

Merrill Lynch & Co. was the bookrunner for the Rule 144A deal.

Proceeds will be used to purchase the $120 million note payable to Northwest at a 15.3% discount to par. Also, Pinnacle said it would use proceeds and cash on hand to repay $5 million under its revolving credit agreement with Northwest.

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