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American Oriental to price $85 million of seven-year convertibles via Merrill Lynch
By Rebecca Melvin
New York, July 7 - American Oriental Bioengineering Inc. plans to price $85 million of seven-year convertible senior notes via bookrunner Merrill Lynch, according to market sources.
Pricing information on the non-callable notes wasn't available by press time.
The deal will be sold under Rule 4(2).
American Oriental expects to use about $30 million of the proceeds to repurchase shares of its common stock under a prepaid forward share repurchase transaction with an affiliate of Merrill Lynch.
Remaining net proceeds are for general corporate purposes, including for working capital and to fund possible acquisitions of and investments in complementary businesses and products.
In connection with the prepaid forward repurchase transaction, American Oriental has been advised that the counterparty may enter into various derivative transactions or purchase or sell shares of American Oriental's common stock concurrently with or following the offering of the convertible notes.
American Oriental withdrew plans to price $125 million of convertible perpetual preferred shares on June 6, after announcing the deal June 3.
American Oriental makes and distributes pharmaceutical and nutraceutical products for primarily Chinese markets. It is based in Shenzhen, the People's Republic of China.
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