Sybase to sell $250 million of 30-year convertibles, talked to yield 3.5% to 4%, up 30% to 35%

By Rebecca Melvin

New York, July 28 - Sybase Inc. plans to sell $250 million of 30-year convertibles after the close Wednesday with talk putting the yield at 3.5% to 4% with an initial conversion premium of 30% to 35%, according to a syndicate source.

There is a $50 million greenshoe.

The Rule 144A deal is being sold via joint bookrunners Merrill Lynch and JP Morgan.

The convertibles will be non-callable for five years until Aug. 20, 2014, with puts on Aug. 15, 2014, Aug. 15, 2019, and Aug. 15, 2024 or in the event of a fundamental change.

Of the proceeds, $50 million will be used to buy back common shares, and $200 million will be used to repurchase the company's existing 1.75% convertible subordinated notes due 2025.

The existing convertibles become callable/putable in February/March 2010.

The stock buyback may have the effect of increasing or preventing a decline in the price of Sybase's common stock concurrently with or following the pricing of the notes.

Dublin, Calif.-based Sybase is a wireless software company focused on mobile and wi-fi technologies.

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