$200m (5m) sen unsec cb coming tomorrow nite from GS/WFC. Terms: 7y, 2.25-2.75% up 30-35%. s/c y4@125%, full pctns. UOP = repay $200 6.25% 15 str8. $5.3B specialty chemical company w/stock up 35%ytd.
PF Cash = 205m
Debt = 1.4B
LTM EBITDA = 521m
FCF = 131m
Lev = 2.3x
Existing 6.125% 2019 back out L+165 but 7yr CDS 110. Age old debate of which there is –ve basis or not is a moot point. We’ll use l+110. ADV = 550k, no leaps, 1y 100d=16%. Like most stks this yr, upward trend = vol drop off. We’ll assume 17%. Theo = 100.9. IG rating, high bond floor/cpn w/obviously attract long only demand. When u add the fact that it is an underrepresented sector & that it is small in size this should be an easy one.