RF Micro talks $300 million converts; 5-years at 0.75%-1.25%, 7-years at 1%-1.5%, both up 22.5%-27.5%

By Kenneth Lim

Boston, March 28 - RF Micro Devices Inc. plans to price $300 million of convertible subordinated notes in five- and seven-year tranches on Thursday after the market closes. The five-year series is talked at a coupon of 0.75% to 1.25% and an initial conversion premium of 22.5% to 27.5%, while the seven-year piece is talked at a coupon of 1% to 1.5% and the same initial conversion premium range.

The notes will be offered at par.

The size of each tranche is $150 million with an over-allotment option for a further $25 million.

Merrill Lynch & Co. is the bookrunner for the Rule 144A offering.

The convertibles will be non-callable.

There will be a contingent conversion trigger at 120% of the conversion price for both series.

The notes will have dividend and takeover protection.

RF Micro Devices, a Greensboro, N.C.-based maker of radio frequency components, said the proceeds of the deal will be used for general purposes, which include working capital, potential acquisitions and future stock repurchases.

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