Interpublic exchanges $400 million new 4.25% convertibles for 4.5% convertibles

By Angela McDaniels

Seattle, Nov. 14 - The Interpublic Group of Cos., Inc. said it will issue $400 million principal amount of new 4.25% convertible senior notes due 2023 to a small number of institutional buyers in exchange for the same principal amount of its old 4.5% convertible senior notes due 2023.

The exchanging holders will also receive accrued interest. The exchange is expected to close on Nov. 15.

The first call date of the new notes is March 15, 2012, and the first put dates are March 15, 2012 and March 15, 2015. In comparison, the first call for the old notes is Sept. 15, 2009, and the first put dates are March 15, 2008 and March 15, 2013.

Payment of cash dividends on Interpublic's common stock will trigger an adjustment to the new notes' conversion rate but will not trigger payment of contingent interest, according to a company news release.

Like the old notes, the new notes will pay interest semiannually and will mature on March 15, 2023. Interpublic said the conversion provisions of the new notes are "substantially similar" to the old notes, and the new notes are subject to restrictions on transfer as a result of the private placement.

The company issued $800 million of the convertibles in March 2003 with a conversion price of $12.42.

Interpublic provides advertising and marketing services and is based in New York.

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