Openwave $100 million convertible talked at 2.75-3.25%, up 20-25%

By Ronda Fears

Nashville, Sept. 2 - Openwave Systems Inc. launched $100 million of five-year convertible notes talked to price to yield 2.75% to 3.25% with a 20% to 25% initial conversion premium via sole lead manager Merrill Lynch & Co.

The Rule 144A deal is scheduled to price after the close Thursday.

The issue will be non-callable for three years and with a 150% hurdle after that.

Holders will have full dividend protection and the first six coupon payments will be collateralized with U.S. Treasuries.

The Redwood City, Calif. communications software company plans to use proceeds, after purchasing the Treasury strips, primarily for additional working capital and other general corporate purposes, including potential acquisitions.

Openwave shares closed Tuesday up 29c, or 5.88%, to $5.22.

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