secondary deal which raised £169.3m.
Invesco was among the selling shareholders.
Shares have performed strongly since the
mOAT ûWHICHûPRICEDûATûP
As a longstanding investor in AJ Bell,
)NVESCOûINTENDSûTOûREMAINûAûSIGNIlCANT ûLONG
term shareholder following the sell-down.
SEQUOIA TARGETS £216m FUNDRAISINGSEQUOIA ECONOMIC INFRASTRUCTURE INCOME FUND is
raising £216m to repay £175.3m of drawn
commitments under the company’s
revolving credit facility and back a pipeline
of acquisitions.
The offering comprises 200m shares at
108p, with 132.64m shares offered to
shareholders through a 1-for-8 open offer,
and the balance and any unsubscribed
shares offered to institutional investors
through a placing and offer for subscription.
Pricing is a 4.85% premium to NAV per
share and 3.74% discount to the Friday May
31 close of 112.2p.
Sequoia’s NAV on May 13 was 103p,
excluding the dividend for the period to
March 31 that was paid on May 30. The new
shares are entitled to the interim quarterly
dividend to June 30, expected to be declared
in June after this transaction closes.
The record date is May 30, with the
open offer running from June 4 until
11am in London on June 21. The placing
and offer for subscription was launched
on Monday and runs until 3pm on June
21 for the offer for subscription and
11am on June 24 for the placing. A result
is due on June 25.
The fund is in various stages of
negotiation on a pipeline of acquisitions
totalling more than £200m, including senior
DEBTûANDûmOATING
RATEûINSTRUMENTSû4HEû
geographical composition is expected to be
approximately 30% US, 20% UK and 50%
Europe.
Stifel is sponsor, adviser and bookrunner.
The fundraising is not underwritten.
AMERICAS
UNITED STATES
MARKET GAINS AUGUR WELL FOR JUNE ECMA renewed market rally spurred by hopes of a
Federal Reserve interest rate cut has energised
US ECM and opened the way for banks to
bring what would normally be more
challenging IPOs to market in the next month.
The highlight in the coming week will be
THEû53Mû)0/ûOFûCYBERSECURITYûlRMû
CROWDSTRIKE, a deal so heavily oversubscribed
ahead of pricing Tuesday that bankers have
already upped the range by 38%.
Thursday brings the US$790.4m IPO of
PetSmart-backed online pet products
retailer CHEWY, a deal that will allow its
parent the ability to cut its heavy debt load.
Bankers also expect to launch several
large IPOs in the next few weeks, though
some are deals that have been in the works
for a considerable time and may present a
MOREûDIFlCULTûSELLûTHANûTHEû)0/SûTHATû
investors have swarmed so far this year.
“I don’t think there is any shortage of
demand for new issues, but low-growth,
high-leverage stuff continues to be a
challenge,” one senior ECM banker said.
Nevertheless, leverage is likely to be a
prominent theme in June’s IPO deal mix.
Among larger deals, Blackstone/
McKesson-backed healthcare IT company
Change Healthcare is eyeing a near-term
launch of its US$1bn-plus IPO, possibly
around the Goldman Sachs annual
healthcare conference later in the week.
A taller order is the IPO of broadcast and
digital radio company iHeartMedia, which is
looking to launch as soon as the coming
WEEKûAFTERûlLINGûPUBLICLYûINû!PRIL
iHeartMedia will go into the IPO with
more than US$5bn of debt but will use the
proceeds to further reduce its leverage after
last year’s Chapter 11 reorganisation.
Another leveraged deal considering a
near-term launch is entertainment, sports
and content company Endeavor, a business
with more than US$4bn of net debt
accumulated through a series of acquisitions
including IMG and the Ultimate Fighting
Championship.
The past week saw US$4.5bn raised from
IPOs and follow-ons, the largest being an
US$838m block sell-down of shares in AXA
Equitable, last year’s biggest IPO, by parent
AXA of France.
Most secondary offerings traded up even
AFTERûPRICINGûWITHûTIGHTûlLE
TO
OFFERû
discounts, though helped by broader market
strength.PARIS CUTS AXA EQUITABLE STAKE AGAINFrench insurer AXA is making short work of
disposing of its remaining shareholding in
AXA EQUITABLE, the US life insurance and asset
management unit it took public in 2018’s
biggest US IPO.
Morgan Stanley and Barclays paired up late
Tuesday to buy 40m AXA Equitable shares in
a block trade with the company’s French
parent, delivering US$838m of proceeds and
cutting its stake to about 40%.
AXA Equitable’s third follow-on since its
May IPO and the latest sell-down by its Paris-
based parent proved a fairly smooth
exercise.
%VENûWITHOUTûTHEûARTIlCIALûSUPPORTûOFûAû
concurrent buyback (the previous secondary
was 40m shares plus 30m bought back), the
two banks were able to price the offering
just a nickel below the stock’s US$21
previous close.
It was later disclosed that the banks
bought the stake for US$20.85 a share,
meaning they stood to collect a US$4m fee.
Wednesday’s aftermarket saw AXA
Equitable stock trade in a US$20.65-$21.15
range before closing a little in the hole at
US$20.90 as 12.9m shares changed hands.
The stock’s tight trading range for most of
the time since it has been public makes AXA
Equitable a fairly low-risk candidate for a
risk trade.
AXA Equitable’s stock price has also
proved resilient against the pronounced fall
in interest rates recently, a drop that could
make it tougher to sell the variable
annuities that remain a key part of AXA’s
Equitable’s product mix.
Some observers were surprised that AXA
did not wait longer to sell and extract a
higher price, but it has publicly committed
to sell all of AXA Equitable as it shifts its
business away from life insurance.
AXA can sell more of its stake in a
month’s time under lock-ups associated
with the follow-on. While it still owns 30%,
AXA will continue to have prior consent
rights over certain activities of its former
unit, including any merger deals or stock
issuance.
Specialist insurer KEMPER’s US$112m
primary block trade executed by Credit Suisse
on the same evening represented a rare visit
to ECM for the specialist insurer.
The offering of 1.35m shares, or just 2% of
OUTSTANDING ûWASû+EMPERSûlRSTûPUBLICû%#-û
deal since the company went public in the
1990s.
Credit Suisse priced the offering at US$83
per share, a 2.5% discount to the close.
#ONSIDERINGû+EMPERSûLOWûPROlLEûANDû
limited liquidity, the discount was tight. The
stock held up in Wednesday’s aftermarket
to close at US$83.73 or above the reofferingEQUITIES AMERICASUS EQUITIES
BOOKRUNNERS: 1/1/2019 TO DATE
Managing No of Total Share
bank or group issues US$(m) (%)
1 Goldman Sachs 77 12,791.81 17.1
2 Morgan Stanley 66 8,923.44 11.9
3 JP Morgan 77 7,681.53 10.3
4 BAML 54 7,027.31 9.4
5 Citigroup 51 5,916.32 7.9
6 Barclays 38 4,703.40 6.3
7 Credit Suisse 39 3,658.93 4.9
8 RBC 25 3,440.91 4.6
9 Wells Fargo 25 2,389.23 3.2
10 Deutsche Bank 14 2,030.97 2.7
Total 302 74,689.96
Including all domestic and international deals and rights issues
Source: Refinitiv SDC code: C3r