By Evan Weinberger
New York, Nov. 6 - Royal Gold, Inc. priced $100 million in mandatory convertible preferred stock due Nov. 15, 2010 to yield 7.25% with an initial conversion premium of 20% on Monday after the close.
The mandatories came in at the cheap end of dividend yield, which was talked at 6.75% to 7.25% and at the middle of initial conversion premium talk, which was 18% to 22%.
Merrill Lynch is the bookrunner of the registered transaction. There is a $15 million over-allotment option.
The mandatories are expected to be listed on Nasdaq under the symbol "RGLD P."
The threshold appreciation price for the mandatories is $35.29 and the conversion ratio is 2.8335.
The mandatories carry a provisional conversion until May 15, 2008. Royal Gold cannot convert the mandatories if it carries out an acquisition of $100 million or more.
There are takeover protections, a make-whole agreement and anti-dilution protections.
Royal Gold is a Denver-based precious metals royalties acquisitions and management company. Royal Gold plans to use the proceeds to acquire further precious metals royalty interests.
Issuer: Royal Gold Inc.
Issue: Mandatory convertible preferred stock
Amount: $100 million
Greenshoe: $15 million
Maturity: Nov. 15, 2010
Dividend: 7.25%
Price: Par
Yield: 7.25%
Conversion premium: 20%
Threshold appreciation price: $35.29
Conversion ratio: 2.8335
Call: Until May 15, 2008 only if the company carries out an acquisition of $100 million or more
Bookrunner: Merrill Lunch
Distribution: Registered
| Pricing date: | Nov. 5, after close
|
| Settlement date: | Nov. 9
|
| Listing: | | Nasdaq "RGLD P"
|
| Talk: | 6.75%-7.25% dividend, up 18%-22%
|
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