New Issue: Affiliated Managers $250 million mandatory convertible yields 6.65%, up 53%

Nashville, Feb. 9 - Affiliated Managers Group Inc. announced Monday that it sold $250 million of new 6.65% four-year mandatory convertibles with a 53% conversion premium in a private placement, and the transaction will essentially extend the maturity of its existing 6% mandatory due Dec. 30, 2004.

AMG said it will simultaneously repurchase 1.7 million shares of its common stock from the purchaser, and intends to repurchase another 1 million shares, or the number of shares required to satisfy the forward purchase contracts of its outstanding mandatory convertible in November 2004.

"The PRIDES [mandatory structure] have the effect of extending the maturity of our obligations with a new, six-year senior note and a forward equity purchase contract due in February 2008," said Darrell W. Crate, chief financial officer of AMG. "The impact of the PRIDES transaction and the share repurchases will be to offset the share issuance related to our outstanding PRIDES this November."

Each mandatory unit consists of both a forward purchase contract for a specified number of common shares and a senior unsecured note.

The mandatory was issued at $1,000 per unit with an effective coupon of 6.65% and a conversion premium of 53% over its closing stock price on Friday, according to the company, for a conversion price of $127.281.

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