By Kenneth Lim
Boston, Sept. 15 - U.S. Bancorp on Friday reoffered $2.5 billion of 30-year convertible senior debentures at 98.9, with a floating coupon set at Libor minus 175 basis points and an initial conversion premium of 16%, market sources said.
The overnight deal was expected to be reoffered between 98.9 and 99.1, according to price talk, with the coupon and premium already set.
There is an over-allotment option for a further $375 million.
Citigroup was the bookrunner for the Rule 144A offering.
The convertibles will be non-callable for the first year, with puts in years one, two, five, 10, 15, 20 and 25.
They will have full dividend protection. Takeover protection is in the form of a change of control put, but there is no premium make-whole feature.
U.S. Bancorp, a Minneapolis-based bank, said part of the proceeds of the deal will be used to fund a concurrent repurchase of up to 10.2 million shares. The remainder of the proceeds will be used for general corporate purposes, including possible additional share buybacks.
| Issuer: | U.S. Bancorp
|
| Issue: | Convertible senior debentures
|
| Bookrunner: | Citigroup
|
| Amount: | $2.5 billion
|
| Greenshoe: | $375 million
|
| Maturity: | Sept. 30, 2036
|
| Coupon: | Libor minus 175 bps
|
| Price: | Par, reoffered at 98.9
|
| Yield: | Libor minus 175 bps
|
| Conversion premium: | 16%
|
| Conversion price: | $38.28
|
| Conversion ratio: | 26.1233
|
| Dividend protection: | Yes
|
| Takeover protection: | Change of control put, no premium make-whole
|
| Call protection: | Non-callable before Sept. 20, 2007
|
| Puts: | Each of Sept. 20, 2007, 2008, 2011, 2016, 2021, 2026, 2031
|
| Price talk: | Libor minus 175 bps, up 16%, reoffered at 98.9-99.1
|
| Pricing date: | Sept. 15 before the open
|
| Settlement date: | Sept. 20
|
| Distribution: | Rule 144A
|
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