February 27, 2019
$200mm Convertible Offering
Size: $200mm + 15% Shoe
Offering Type: 144A
Execution Structure:1 Day Marketed
Maturity: 5 Years
Structure: Non-Call Life
Coupon: 0.75%
Premium: 35.0%
Effective Premium: 100% with Capped Call
Stock Price Impact: 0.0%
Matthews South Role: Financial Advisor
Active Bookrunners: JP Morgan / Barclays
Offering Type: 144A
Execution Structure:1 Day Marketed
Maturity: 5 Years
Structure: Non-Call Life
Coupon: 0.75%
Premium: 35.0%
Effective Premium: 100% with Capped Call
Stock Price Impact: 0.0%
Matthews South Role: Financial Advisor
Active Bookrunners: JP Morgan / Barclays
$200mm Convertible
Transaction and Process Overview
Syndicate Selection
- Matthews South helped the company navigate the syndicate selection process and generate a lineup that included 6 bookrunners plus 5 co-managers –compared to average ~2 bookrunners on similarly sized deals
- Large syndicate achieved key company objective of significantly expanding banking relationships
Day of Marketing
- Advised the company on day of execution to ensure efficient terms and minimal market impact
- The bond priced toward the issuer friendly end of both coupon and premium ranges with zero stock price dislocation, compared to average 5.9% decline in last 20 marketed convertible deals
Structuring
- Matthews South advised the company on whether or not to include a capped call and the structure of the capped call
- Evaluated merits of including a provisional call with make-whole; the company elected to use a non-call life security based on Matthews South advice and analysis
Designed Call Spread Bid Process to Optimize Terms
- Developed and ran a competitive bid process to achieve attractive pricing on the capped call
- Added banks to process that showed aggressiveness in other situations
- Saved $1.6mm on the capped call vs. pricing indications received in week before execution
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