Jakks greenshoe exercised, increasing convertibles to $115 million

By Angela McDaniels

Tacoma, Wash., June 12 – Jakks Pacific Inc. said the underwriter of its $100 million offering of 4.875% six-year convertible notes exercised the $15 million over-allotment option in full on Thursday, increasing the size of the issue to $115 million.

As previously reported, the company priced an upsized $100 million of the convertibles after the market closed on June 3 at par with an initial conversion premium of 25%.

Initially, the Rule 144A offering was expected to be $75 million in size with an $11.25 million greenshoe.

BofA Merrill Lynch was the bookrunner.

Pricing came toward the cheap end of coupon talk of 4.5% to 5% and at the cheap end of 25% to 30% premium talk.

The bonds are non-callable. They will be physically settled, and they have standard takeover protection via a make whole.

Proceeds will be used to repurchase some or all of the company’s $39 million 4.5% convertible senior notes due Nov. 1, 2014. The company plans to use up to $25 million of proceeds to fund the cost of purchasing common shares by entering into a prepaid forward share repurchase with an affiliate of BofA Merrill Lynch. Any remaining proceeds will be used for general corporate purposes.

Malibu, Calif.-based Jakks is a toy and leisure products company.

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