By Ronda Fears
Nashville, Tenn., Nov. 14 - Rite Aid Corp. advanced the pricing of its new deal, selling an upsized $200 million of five-year convertible senior notes after sweetening price talk. The Rule 144A issue sold at par to yield 4.75% with a 24.28% initial conversion premium, via joint lead managers J.P. Morgan and Salomon Smith Barney. That was in the middle of revised price talk that put the yield between 4.5% and 5.0%. The premium was more aggressive than revised guidance of 20% to 24% but within original price talk on the premium. Originally, the deal was talked to price to yield 4.0% to 4.5% and with a 20% to 25% initial conversion premium.
Camp Hill, Pa.-based Rite Aid, a drugstore chain, said it would use proceeds to reduce debt outstanding under its revolving credit facility of its senior secured credit agreement.
Last week, Rite Aid reported October same-store sales rose 8% from October 2000 with pharmacy same- store sales gaining 11.7% and front-end same-store sales up 2.1%. For the 34-week period ended Oct. 27, same-store sales increased 8.6% with an 11.6% gain in pharmacy same-store sales and a 4.1% rise in front-end same-store sales.
Terms of the new deal are:
Issuer: Rite Aid Corp.
Amount: $200 million, upped from $125 million
Greenshoe: $50 million, upped from $18.75 million
Lead Manager: J.P. Morgan and Salomon Smith Barney
Maturity Date: Dec. 1, 2006
Coupon: 4.75%
Issue Price: par
Yield: 4.75%
Conversion Premium: 24.28%
Conversion Price: $6.50
Conversion Ratio: 15.3846
Call: non-callable for three years, then with 125% trigger
Expected Rating(s): Moody's: Caa2
| S&P: B-
|
| Settlement Date: | Nov. 19
|
|
|
| End
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
