By Rebecca Melvin
New York, May 22 - ShengdaTech Inc. priced $100 million of 10-year convertible senior notes to yield 6% with an initial conversion premium of 18%, according to a news release.
The notes priced beyond the cheap end of talk, which was 4.5% to 5% for the coupon, and 22.5% to 27.5% for the initial conversion premium.
The Rule 144A deal, sold via bookrunner Oppenheimer & Co., has a greenshoe of $15 million.
The notes are non-callable for three years, then provisionally callable for two years subject to a 150% hurdle. There is a put after 3.5 years.
ShengdaTech expects to use about $56 million of the proceeds to expand its nano precipitated calcium carbonate, or NPCC, production capacity, while the remaining proceeds will be allocated to potential coal-based chemical acquisitions, strategic investments and to fund working capital.
Based in Tai'an City, Shandong Province, China, the company makes and markets NPCC and coal-based chemicals. The products are used in various applications, including tires and polyvinyl chloride, or PVC, building materials.
| Issuer: | ShengdaTech Inc.
|
| Issue: | Convertible senior notes
|
| Amount: | $100 million
|
| Greenshoe: | $15 million
|
| Maturity: | 2018
|
| Coupon: | 6%
|
| Price: | Par
|
| Yield: | 6%
|
| Conversion premium: | 18%
|
| Conversion price: | $9.94
|
| Conversion ratio: | 100.6036
|
| Price talk: | 4%-4.5%, up 22.5%-27.5%
|
| Calls: | Non callable until 2011, then provisionally convertible subject to 150% hurdle
|
| Put: | After 3.5 years |
|
| Bookrunner: | Oppenheimer & Co.
|
| Pricing date: | May 21, after close
|
| Settlement: | May 28
|
| Distribution: | Rule 144A
|
| Stock symbol: | Nasdaq: SHTH
|
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