Cypress to price $500 million two-year convertibles, talked at 0.75%-1.25%, up 20%-25%

By Kenneth Lim

Boston, March 6 - Cypress Semiconductor Corp. plans to price $500 million of 2.5-year convertible senior notes on Wednesday after the market closes, talked at a coupon of 0.75% to 1.25% and an initial conversion premium of 20% to 25%.

The notes will be offered at par.

There is an over-allotment option for a further $100 million.

Credit Suisse is the bookrunner of the Rule 144A offering.

The notes will be non-callable.

There will be a contingent conversion trigger at 130% of the conversion price.

There notes will have dividend and takeover protection.

There will be a net-share settlement feature.

Cypress, a San Jose, Calif.-based semiconductor manufacturer, said the proceeds of the deal will be used to buy back shares of its common stock and to fund convertible note hedge and warrant transactions.

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