$100m (+15m) sen unsec cb coming tonight from ML/BARC/JPM. Terms 4yr, 3-3.5% up 37.5-42.5%, full pctns. Concurrent $250m 6yr str8. UOP = repay 6.5/8.625% str8. Illiquid 5.85% 17 OAS ~576bp, 5.875% 16 OAS ~460bp, 5yr CDS ~525, we’ll use L+500. Small 685 mkt cap, ADV = 760k, means we’ll discount vol to 25% & use […]
10/16/12 WAC $265m (+25m) sen sub cb coming weds from CS/MS/MER/BARC. Terms: 7 yr, 4.5-5% up 35%-40%, full pctns. Concurrent 4.5m (+675k) stk offer UOP = acq/repay second lien debt. Stk +132% since 05/12 & @highest pt > 2007 housing crash, issuing down cap/structure to refi makes obv sense 4 co. Current debt secured ($2.2B […]
10/11/12 SWC $300m (+45m) sen unsec cb coming tonight from CS/WFC. Terms: 20 yr 1.75-2.25% up 47.5-52.5% (hyper), 7 yr full pctns. UOP=repay 1.875% cb/gcp. $1.4B mkt cap palladium and platinum miner. Bought marathon in 2010 (sold 25% to Mitsubishi) & will need $500m in funding to YE16, bought Altar in 2011 & will need […]
Trade Idea: Exterran Holdings (EXH) $355m 4.25% converts due 6/15/14 trade at 107.75 vs. 18 for 3.9% current yield and 38.6% premium. Using 500 credit spread, the implied vol. is 38 and delta is 55. This seems cheap given the historical realized vol. of over 50. The credit also has potential for tightening as we […]
10/03/12 ARCC $200m ($30m) sen unsec cb coming tonight from JPM/GS/DB. Terms: 5.25y, 4.25-4.75 up 17.5-22.5, full pctns. UOP=repay dbt/gcp. 4th sequel in ARCC w/progressively worse cpns; 5.75% +17.5% in 01/11, 5.125% +17.5% in 03/11 & then 4.875% +17.5% in 03/12. Interestingly, all 3 priced off a 16c stk range over 14m period. They have […]
10/01/12 Wellpoint (WLP) $1.35B (+150m) sen unsec cb coming tomorrow from CS/MER/UBS. Terms: 30 yr, 2.5-3% up 20-25%, s/c 10 yr @150%, full pctns. UOP = gcp/stk buyback/debt repayment. Happy Meal. After ~950B of str8 IG issuance ytd, we get a shot. Recent A- (S&P) 4.65% ’43 str8 z-spread ~200 (UOP=AGP acq), 7 yr CDS […]
9/24/12 GTAT $175m (15%) sen unsec cb coming tonight from UBS/MER/CS. Terms: 5yr, 3-3.5% up 25-30%, full pctns. UOP = hedge/gcp. Interesting equity story w/the replacement of glass w/sapphire on smart phones/tablets. Cash will be used 2 continue its diversification from solar (45% of CY12 sales coming from LED). We see credit as CCC. PF […]
9/19/12 XPO Logistics (XPO) $100m (+15m) sen unsec cb coming tonight from MS/DB/JEF. Terms: 5yr, 4-4.5% up 20-25%, s/c 4yr @130% (m/whole prem), full pctns. UOP = gcp/acq. Bradley Jacob’s equity play (who consolidated waste mgmt & equipment rental industries in 90s). He invested in XPO in 4Q11, currently owns 52% & did a […]
9/18/12 Ctrip.com (CTRP) $140m (+20m) sen unsec cb coming overnight from JPM. Terms: 5yr, 0-1% up 10-15%, 3yr put, full pctns. UOP=hedge/gcp. Btw reverse merger mess (SDTH, CMED, AOB, TRE, etc) & the performance of HMIN on way down (another Chinese cb into adr) this is a hard sell. Don’t get us wrong, this is […]
$100m (+15m) sen unsec cb coming tonight from BARC. Terms: 5yr, 7-7.5% up 10-15%, full pctns. UOP = gcp/sfv investment. Small $440m tech BDC w/$439 total inv (70% sen/sec, 29% CLO debt/eqty). LTM ebitda = 28, fcf = -38m, PF cash = 256m, debt 321m. Larger PSEC & AINV = comps (although both rated). 5yr […]