Vertex Pharmaceuticals launches $250 million convertibles due 2013; talked at 4.75%-5.25%, up 27.5%-32.5%

By Evan Weinberger

New York, Feb. 11 - Vertex Pharmaceuticals Inc. launched $250 million in convertible senior subordinated notes due 2013 on Monday after the market close.

The convertibles are talked at a 4.75% to 5.25% coupon and a 27.5% to 32.5% initial conversion premium.

The deal is expected to price Tuesday after the market close.

Merrill Lynch is the bookrunner of the Securities and Exchange Commission-registered transaction.

There is a $37.5 million over-allotment option.

The convertibles have two years of call protection.

The convertibles carry fundamental change protection and a make-whole premium.

Vertex launched a concurrent offering of 6 million shares of common stock. There is a 900,000 share greenshoe on the common stock offering. The two offerings are separate and not contingent upon each other.

Vertex is a Cambridge, Mass.-based drug maker. The company plans to use the proceeds for general corporate purposes, which include the marketing and development of its drug telaprevir and other purposes.

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