Rentech offers $50 million of seven-year convertibles in off-the-shelf deal to pay for acquisition

By Kenneth Lim

Boston, April 3 - Rentech Inc. said late Monday that it plans to offer $50 million of seven-year convertible senior notes with a greenshoe option of a further $7.5 million.

The unsecured convertibles are being offered at par. No details were given regarding price talk.

Credit Suisse is running the books.

Rentech may call the convertibles at any time with a premium make-whole in the first five years only if the 10-day volume weighted average price of the common stock exceeds 150% of the conversion price for at least five straight trading sessions. That soft-call protection ends in 2011, after which the convertibles may be called at any time.

Takeover protection is in the form of a change-of-control put and a premium make-whole feature.

Rentech is also offering 12.5 million shares of common stock with a greenshoe option of a further 1.875 million shares in a concurrent shelf issue. It said the combined offerings could raise gross proceeds of about $102 million. That values the stock offering at $52 million if over-allotment options are excluded.

Rentech, a Denver, Colo.-based developer of alternative fuel technology, said it is using the proceeds to pay for its pending purchase of Royster-Clark Nitrogen Inc., to fund working capital at Royster-Clark and for general corporate purposes. Royster-Clark owns and operates a natural gas-fed nitrogen fertilizer plant in East Dubuque, Ill.

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