$1B (+150m) sr converts coming overnight/happy meal from GS.
Terms: re-offer at 98.5-99. 7 year bullet, 0.35 up 66%, full pctns, UOP = share buyback /GCP
@98.5: 0.57% up 63.5%. We’ll use 120 for 7 yr, 30 vol. GC borrow, Theo = 95.3 and 35 iv.
The existing 1% got crushed today ahead of this from 34iv to 31iv. New deal is 48% delta, 83.6 floor vs. 94.8 floor and 57% delta on older 1%. No doubt IG rated which will always have its appeal, but at these levels on both there is no obvious switch from 2018 to 7 yr new deal. We’re wondering who negotiated this deal, perhaps they need William Shatner to sell it. Would rather play CNQR or N based on these terms.AVOID