By Rebecca Melvin
New York, July 6 - Rocky Mountain Dealerships Inc. priced C$30 million of seven-year convertible unsecured subordinated debentures on a bought-deal basis at par to yield 7% with an initial conversion premium of 40%, according to a news release.
The deal was sold under a short-form prospectus in Canada via a syndicate of underwriters co-led by National Bank Financial and RBC Capital Markets.
There is an over-allotment option for up to an additional C$1.5 million of debentures, or 5% of the deal.
At the holder's option, the debentures may be converted into common stock at any time on the earlier of maturity and the business day immediately preceding the date fixed for redemption at a conversion price of C$10.65 per share.
The debentures will be non-callable until Sept. 30, 2014. They will be provisionally callable for the following year if the market stock price is 125% of conversion.
Proceeds will be used for repayment of a portion of debt, for general corporate purposes and to fund future acquisitions.
The offering is subject to normal regulatory approvals, including the approval of the TSX, and is expected to close by July 27.
Based in Calgary, Alta., Rocky Mountain Dealerships sells and leases agriculture and construction equipment.
| Issuer: | Rocky Mountain Dealerships Inc.
|
| Issue: | Convertible unsecured subordinated debentures
|
| Amount: | C$30 million
|
| Greenshoe: | C$1.5 million
|
| Maturity: | Sept. 30, 2017
|
| Bookrunners: | National Bank and RBC Capital (co-leads)
|
| Coupon: | 7%
|
| Price: | Par
|
| Yield: | 7%
|
| Conversion premium: | 40%
|
| Conversion price: | C$10.65
|
| Calls: | Non-callable until Sept. 30, 2014
|
| Distribution: | Short-form prospectus in Canada
|
| Pricing date: | July 6
|
| Settlement date: | July 27
|
| Stock symbol: | TSX: RME
|
| Stock price: | C$7.60 at close July 6
|
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