Interpublic exchanges $200 million new 4.75% convertibles for 4.5% convertibles

By Jennifer Chiou

New York, Nov. 15 - Interpublic Group of Cos., Inc. said it will issue $200 million principal amount of new 4.75% 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 Tuesday.

The main differences between the new notes and the old notes include:

• The interest rate will be 4.75% rather than 4.5%;

• The first call date will be March 15, 2013 rather than Sept. 15, 2009;

• The first put date will be March 15, 2013 rather than March 15, 2008; and

• 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.

Like the old notes, the new notes will pay interest semiannually and will mature on March 15, 2023.

The conversion provisions of the new notes are also substantially similar to those of the old notes.

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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