By Rebecca Melvin
New York, Sept. 22 - Vertex Pharmaceuticals Inc. priced an overnight offering of $375 million of five-year convertible senior notes early Thursday to yield 3.35% with an initial conversion premium of 35%, according to a release.
The deal, which has an over-allotment option for a further $25 million of notes, came toward the cheap end of talk for the coupon, which was 3% to 3.5%, and at the fixed point talked for the premium.
Bank of America Merrill Lynch was sole underwriter of the deal, which was sold from a shelf registration with the Securities and Exchange Commission.
Proceeds will be used for general corporate purposes which may include investment in the development and commercialization of telaprevir and VX-770, clinical trial costs and other development costs for telaprevir and VX-770 and other drug candidates, research expenditures, and potentially acquisitions.
The notes have a provisional call prior to Oct. 1, 2013 if the closing price of shares is greater than 130% of the conversion price for at least 20 out of 30 consecutive days. The call price is par plus a make-whole payment for interest. Starting Oct. 1, 2013, the notes have a hard call.
Holders may require Vertex to repurchase all or any part of their notes upon the occurrence of a fundamental change.
Vertex is a Cambridge, Mass.-based drug maker.
| Issuer: | Vertex Pharmaceuticals Inc.
|
| Issue: | Convertible senior notes
|
| Amount: | $375 million
|
| Greenshoe: | $25 million
|
| Maturity: | Oct. 1, 2015
|
| Boorunner: | Bank of America Merrill Lynch
|
| Coupon: | 3.35%
|
| Price: | Par
|
| Yield: | 3.35%
|
| Conversion price: | $48.83
|
| Conversion premium: | 35%
|
| Conversion ratio: | 20.4794
|
| Calls: | Provisional call until Oct. 1, 2013 with 130% hurdle, then hard call
|
| Takeover protection: | Yes
|
| Pricing date: | Sept. 23
|
| Distribution: | Off shelf
|
| Stock symbol: | Nasdaq: VRTX
|
| Stock reference price: | $36.17
|
| Market capitalization: | $7.24 billion
|
| Price talk: | 3%-3.5%, up 35%
|
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