New Issue: Province Healthcare $150 mln converts yield 4.25%, up 27%

Nashville, Tenn., Oct. 4 - Province Healthcare Co. priced $150 million of seven-year convertible subordinated notes at a yield of 4.25% and an initial conversion premium of 27%, according to a source familiar with the deal.

Pricing on the issue was moved up with terms set early Thursday off Wednesday's closing stock price, having previously been scheduled for after the market closed on Oct. 4.

The yield on the Rule 144A offering came in at the aggressive end of talk of 4.25% to 4.75% while the initial conversion premium was more aggressive than talk of 20% to 25%.

The deal came to market via bookrunner Merrill Lynch & Co. and joint lead managers First Union Securities and UBS Warburg. Banc of America Securities was co-manager.

Brentwood, Tenn.-based Province Healthcare, a hospital operator, said it intends to use proceeds from the deal to pay down debt and fund future hospital acquisitions, for working capital and general corporate purposes.

Issuer: Province Healthcare Co.

Amount: $150 million

Greenshoe: $22.5 million

Maturity: Oct. 10, 2008

Coupon: 4.25%

Price: Par

Initial conversion premium: 27% (based on $32.73 close Wednesday)

Conversion price: $41.567

Conversion ratio: 24.057

Settlement: Oct. 10 flat

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