By Kenneth Lim
Boston, March 9 - West Pharmaceutical Services Inc. priced $150 million of 40-year convertible junior subordinated debentures within talk on Thursday to yield 3.5% with an initial conversion premium of 32.5%.
The convertibles were offered at par. They were talked at a coupon of 3.5% to 4% and an initial conversion premium of 30% to 35%.
There is an over-allotment option for a further $22.5 million.
UBS Investment Bank was the bookrunner of the registered off-the-shelf offering.
The convertibles are non-callable but may be converted at West Pharmaceutical's option after the fifth year subject to a hurdle at 150% of the conversion price. The convertibles may not be put.
Interest payments may be deferred for periods of up to 10 straight years.
There is dividend protection for quarterly cash payouts above 13 cents per common share. There will be a change-of-control conversion right and a make-whole adjustment.
West Pharmaceutical, a Lionville, Pa.-based maker of closure systems and syringe components for use with injectable drugs, said the proceeds of the deal will be used for general purposes.
| Issuer: | West Pharmaceutical Services Inc.
|
| Issue: | Convertible junior subordinated debentures
|
| Bookrunner: | UBS Investment Bank
|
| Amount: | $150 million
|
| Greenshoe: | $22.5 million
|
| Maturity: | March 15, 2047
|
| Coupon: | 3.5%
|
| Price: | Par
|
| Yield: | 3.5%
|
| Conversion premium: | 32.5%
|
| Conversion price: | $56.07
|
| Conversion ratio: | 17.8336
|
| Dividend protection: | Conversion ratio adjustment if common dividend exceeds 13 cents per share
|
| Takeover protection: | Change-of-control conversion with make-whole adjustment
|
| Call protection: | Non-callable for cash. May be automatically converted from March 20, 2012 subject to hurdle at 150% of conversion price
|
| Puts: | None
|
| Price talk: | 3.5%-4%, up 30%-35%
|
| Pricing date: | March 8, after the close
|
| Settlement date: | March 14
|
| Distribution: | Registered
|
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