By Sara Rosenberg
New York, May 29 - Lucent Technologies Inc. priced an upsized offering of $1.525 billion convertible senior debt after the market close on Thursday.
The $750 million tranche A due 2023 priced at par to yield 2.75% with an initial conversion premium of 48%. The $775 million tranche B due 2025 priced at par to yield 2.75% with an initial conversion premium of 38%.
The terms were at the midpoint of revised talk for both tranches. The deal was originally sized at $1.3 billion.
Price talk was changed during Thursday's session, raising the premium guidance and keeping yield guidance unchanged.
The revised talk was for a 2.375% to 2.875% yield with an initial conversion premium of 46% to 50% on the tranche A and 2.375% to 2.875% yield with an initial conversion premium of 36% to 40% on the tranche B due in 2025. Originally, the tranche A was expected to have an initial conversion premium of 42% to 46% and the tranche B was expected to have an initial conversion premium of 32% to36%.
Citigroup Global Markets and JPMorgan are joint bookrunning managers for the registered offering and HSBC is a joint lead manager.
Both tranches have a 15% greenshoe.
The A tranche has hard call protection for five years and then soft call protection in years six through seven at 130%. The B tranche has hard call protection for six years and then soft call protection in years seven through 10 at 130%.
The A tranche has puts in years 7, 12 and 17. The B tranche has puts in years 10 and 16.
There is a contingent conversion feature at 120%.
The Murray Hill, N.J. network provider will use the proceeds towards the repayment or possible repurchase of certain short- and medium-term obligations over time, as well as for general corporate purposes.
Terms of the new deal are:
| Issuer: | Lucent Technologies Inc.
|
| Issue: | Convertible senior debentures
|
| Amount: | $1.525 billion
|
| Bookrunners: | Citigroup, JPMorgan
|
| Lead manager: | HSBC
|
| Contingent conversion: | 120%
|
| Pricing date: | May 29
|
| Settlement date: | June 4, 2003
|
| Ratings: | Moody's: Caa1
|
| S&P: B-
|
|
|
| Tranche A:
|
| Size: | $750 million
|
| Greenshoe: | 15%
|
| Maturity date: | June 15, 2023
|
| Coupon: | 2.75%
|
| Price: | Par
|
| Yield: | 2.75%
|
| Conversion premium: | 48%
|
| Conversion price: | $3.34
|
| Conversion ratio: | 299.4012
|
| Call: | Non-callable for five years; soft call in years six through seven at 130%
|
| Put: | In years 7, 12 and 17
|
|
|
| Tranche B:
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| Size: | $775 million
|
| Greenshoe: | 15%
|
| Maturity date: | June 15, 2025
|
| Coupon: | 2.75%
|
| Price: | Par
|
| Yield: | | 2.75%
|
| Conversion premium: | 38%
|
| Conversion price: | $3.12
|
| Conversion ratio: | 320.5128
|
| Call: | Non-callable for five years; soft call in years seven through 10 at 130%
|
| Put: | In years 10 and 16
|
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