Priceline Prices Its Bonds

Priceline.com (NASDAQ: PCLN  ) clarified the details this morning on its massive $1 billion bond issue.

According to the company, the billion dollars worth of convertible notes will:

Pay their owners 0.35% interest, paid semiannually. Be convertible into common stock or back into cash at approximately a conversion rate of approximately $1,315.10. Become convertible at Priceline's discretion -- not the bonds' holders.

Priceline expects to raise close to $979 million from the bond offering after covering fees and expenses. This number could rise, however, as Priceline is giving its underwriters an overallotment option to buy as much as $150 million bonds over the initial $1 billion floatation.

The company also reiterated its intentions for how to use the cash -- by buying up $1 billion worth of its own common stock at today's prices, which offer about a 38% discount to where the bonds might ultimately revert back into stock.

Priceline shares finished the day up 1.9% at $807.54.