By Rebecca Melvin
Princeton, N.J., Jan. 26 - United Auto Group Inc. priced an upsized $325 million of 20-year convertibles at par to yield, 3.5% with an initial conversion premium of 25%, according to a syndicate source.
The deal was expected to be $250 million. The convertible senior subordinated notes priced at the cheap end of talk, which was for a coupon of 3% to 3.5% and an initial conversion premium of 25% to 30%.
Merrill Lynch was bookrunner for the Rule 144A deal, and Thomas Weisel was co-manager.
There is a $50 million over-allotment option.
The notes are non-callable for five years, with puts in years five, 10 and 15.
The notes also feature dividend and takeover protection, as well as contingent conversion at a trigger of 120% and contingent payment, also at a trigger of 120%.
Proceeds will be used to repay long-term debt under its revolving senior credit facility, which may be re-borrowed, and to buy, simultaneously with the offering, 500,000 shares of common stock.
Based in Bloomfield Hills, Mich., United Auto Group is a U.S. automotive retailer.
| Issuer: | United Auto Group Inc.
|
| Issue: | Convertible senior subordinated notes
|
| Bookrunner: | Merrill Lynch & Co.
|
| Co-manager: | Thomas Weisel
|
| Amount: | $325 million
|
| Greenshoe: | $50 million
|
| Maturity: | April 12, 2026
|
| Coupon: | 3.5%
|
| Price: | Par
|
| Yield: | 3.5%
|
| Conversion premium: | 25%
|
| Conversion price: | $47.39
|
| Conversion ratio: | 21.1015
|
| Calls: | Non-callable for five years
|
| Puts: | In years five, 10 and 15
|
| Price talk: | 3%-3.5%, up 25%-30%
|
| Pricing date: | Jan. 26
|
| Settlement date: | Jan. 31
|
| Distribution: | Rule 144A
|
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