Cambrex $125 million convertibles talked at 3.5-4.0% yield, 30-34% premium

By Ronda Fears

Nashville, Tenn., Dec. 4 - Cambrex Corp. launched $125 million of five-year convertible subordinated notes with price talk of a 3.5% to 4.0% yield and a 30% to 34% initial conversion premium. The Rule 144A issue is set to price after the close Thursday, via joint book-running lead managers Bear Stearns & Co. and Banc of America Securities.

The convertibles will be non-callable for three years, but have a contingent conversion threshold of 120%. There is a $25 million greenshoe.

On Friday, the East Rutherford, N.J.-based company announced a reorganization whereby on Jan. 1 its operating units that primarily produce specialty and fine chemicals, and animal health and agriculture products will be combined under a new subsidiary Rutherford Chemicals Inc. As a result, the company said it expects to take one-time charges in the fourth quarter estimated to be between $10 million and $20 million, the majority of which are expected to be non-cash items.

Also last week, the company announced $430 million in new credit lines consisting of a 364-day renewable senior revolving credit facility for $161.25 million and a 5-year senior revolving credit facility for $268.75 million. The new agreements renew and extend about $300 million of existing bank debt that was scheduled to mature in September 2002, the company said.

Cambrex is a global, diversified life science company that provides products and services to the pharmaceutical, biopharmaceutical, biotechnology and other research industries. Cambrex shares closed Tuesday down $1.30 to $37.50.

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