PSS World Medical $125 million convertible talked at 2.25-2.75%, up 40-45%

By Ronda Fears

Nashville, March 1 - PSS World Medical Inc. launched $125 million of 20-year convertible notes talked to yield 2.25% to 2.75% with a 40% to 45% initial conversion premium. The issue will be sold on swap, with $35 million of proceeds earmarked to buy back stock.

Goldman Sachs & Co. is sole bookrunner of the Rule 144A deal, which is scheduled to price after Tuesday's close.

The senior notes will be non-callable for five years with puts in years five, 10 and 15.

There is a 120% contingent conversion trigger and 120% contingent payment trigger.

There is a $25 million greenshoe available.

The Jacksonville, Fla.-based specialty marketer and distributor of medical products said, after the stock purchases, $60 million of proceeds would be used to reduce its revolving credit facility. Any remaining proceeds would be used for general corporate purposes.

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