!BINGWORTHû-ANAGEMENT ûAû5+
BASEDû
PRIVATEûEQUITYûlRMûFOCUSEDûONûLIFEû
SCIENCES ûANCHOREDûTHEûlNANCINGû'ATEû
Ventures, the Bill Gates VC, was a notable
Exicure backer with a 14.3% pre-offer
stake.
Exicure needed to raise cash.
After burning through US$5m in the
June quarter, the company had only
US$17.5m of cash. The equity raising gives
it nearly US$75m of cash to fund Phase Ib/
II trials of a cancer drug.
STRUCTURED EQUITY
CHINA
JP MORGAN SELLS TENCENT-
REFERENCED EBS
JP MORGAN has raised US$400m from a
three-year cash-settled exchangeable bond
ISSUE ûWITHûSHARESûOFû(ONGû+ONG
LISTEDû
TENCENT HOLDINGS as the reference shares.
The EB issue was launched with a base
SIZEûOFû53MûANDûAûSAME
DAYûUPSIZEû
OPTIONûOFû53Mû4HEûUPSIZEûOPTIONûWASû
fully exercised.
4HEû%"SûWEREûMARKETEDûATûAûZEROûCOUPONû
and a negative yield-to-maturity of –1.777%
to –1.620%, an issue price of 105–105.5 and
an exchange premium of 25%.
The deal was priced at the mid-point of
the ranges, with the yield-to-maturity
settled at –1.698% and the issue price at
105.25.
The issuance is an exercise to hedge JP
-ORGANSûPOSITIONSûINû4ENCENTûSHARESû4HEû
bonds are cash-settled.
JP Morgan was the bookrunner.CHUANTOU ENERGY PASSES CB
HEARINGShanghai-listed SICHUAN CHUANTOU ENERGY has
cleared a China Securities and Regulatory
Commission hearing to issue Rmb4bn
(US$580m) of six-year convertible bonds.
The provincial government-owned
company is active in hydropower, clean
energy development and railway
information systems in China.
It will use the proceeds to increase the
capital of Yalong River Hydropower
Development, in which it owns a 48% stake.
State-owned SDIC Power holds the
remaining 52%. YRHD needs working capital
to build a hydroelectric power station.
Chuantou Energy’s A-shares closed up
1.5% on July 29 at Rmb9.35.
In April 2018, the issuer withdrew its
application for a proposed issue of six-year
CBs to raise up to Rmb4bn, but its board
approved the current plan the following
month.
Credit Suisse Founder Securities is
bookrunner for the CB.SOUTH KOREA
LG DISPLAY SELLS CBLG DISPLAYûRAISEDû53MûFROMûAûlVE
year put three convertible bond issue last
Tuesday.The CBs were marketed at a coupon of
1.0%–1.5% and a conversion premium of
25%–30%. The coupon was set at the top of
the range while the conversion premium
WASûlXEDûATû
The deal was about 3.5 times covered,
drawing orders of US$2.5bn. About 60% of
demand came from hedge funds and the
rest from outright investors.
The CB’s scarcity value attracted
investors as there is a limited supply of
3OUTHû+OREANûPAPERûEACHûYEAR
However, investors were price-sensitive
as they have concerns over the company’s
FUTUREûGROWTH ûLEADINGûTOûlNALûTERMSûCLOSEû
to best for investors.
LG Display’s operating loss in the
quarter to June 30 widened to W369bn
(US$313m) from W228bn a year earlier.
The company has been struggling with a
global supply glut in LCDs used in
television sets, which has pushed down
prices, according to Reuters. It is also
facing uncertainty caused by the Sino-US
trade dispute.
Its shares fell as much as 9.5% to a record low
of W14,250 last Wednesday. As of last Thursday,
the stock was down 20% so far this year.
The credit spread was assumed at 200bp,
stock borrowing at 50bp giving implied
VOLATILITYûOFûûANDûBONDûmOORûATûAROUNDûû
Historic vol is in the mid-30s.
The CBs traded at around 101 in the
secondary market.
Proceeds will be used for general
corporate purposes, including working
capital related to LG’s OLED business and
raw material purchases.
Bank of America Merrill Lynch and Morgan
Stanley were bookrunners.EQUITY-LINKED DEALS WEEK ENDING: 2/8/2019
Issuer Country Date Amount Greenshoe Tenor Coupon (%) Premium (%) Bookrunner(s)
LG Display South Korea 31/07/19 US$687.8m — 5y 1.5 26 BAML, Morgan Stanley
Tencent Holdings China 02/08/19 US$400m — 3y 0.0 25 JP Morgan
GLOBAL CONVERTIBLE OFFERINGS
BOOKRUNNERS: 1/1/2019 TO DATE
Managing No of Total Share
bank or group issues US$(m) (%)
1 Goldman Sachs 22 5,547.13 8.5
2 BAML 26 5,093.40 7.8
3 JP Morgan 30 4,384.88 6.8
4 Citic 10 4,226.26 6.5
5 Morgan Stanley 24 3,667.33 5.6
6 Citigroup 19 3,277.67 5.0
7 Credit Suisse 17 3,161.36 4.9
8 China Securities 9 2,593.11 4.0
9 Bank of China 4 2,442.73 3.8
10 China Intl Capital 3 2,220.11 3.4
Total 212 64,934.64
Including exchangeables and domestic offerings.
Source: Refinitiv SDC code: C9
GLOBAL CONVERTIBLE OFFERINGS – US
BOOKRUNNERS: 1/1/2019 TO DATE
Managing No of Total Share
bank or group issues US$(m) (%)
1 BAML 17 3,444.58 19.3
2 Goldman Sachs 13 2,060.61 11.6
3 Morgan Stanley 11 1,856.66 10.4
4 JP Morgan 13 1,642.39 9.2
5 Barclays 12 1,397.31 7.8
6 Citigroup 10 1,185.24 6.6
7 Credit Suisse 6 1,165.00 6.5
8 HSBC 2 592.19 3.3
9 Jefferies 8 591.98 3.3
10 Wells Fargo 7 547.38 3.1
Total 47 17,824.98Source: Refinitiv SDC code: C9aGLOBAL CONVERTIBLE OFFERINGS – EMEA
BOOKRUNNERS: 1/1/2019 TO DATE
Managing No of Total Share
bank or group issues US$(m) (%)
1 JP Morgan 9 1,453.48 14.5
2 BNP Paribas 6 1,074.09 10.7
3 HSBC 5 793.25 7.9
4 UBS 3 764.25 7.6
5 Citigroup 2 739.78 7.4
6 Morgan Stanley 4 732.16 7.3
7 BAML 2 555.35 5.6
8 Credit Suisse 2 502.23 5.0
9 SG 4 458.73 4.6
10 Natixis 3 401.93 4.0
Total 26 10,002.18
Including exchangeables.
Source: Refinitiv SDC code: C09d