IFR 03.21.2020

(^80) International Financing Review March 21 2020
CEO Bruce Linton, is in a similar day-to-day
holding pattern on its US$150m IPO. Sole
bookrunner Cantor Fitzgerald had hoped to
price that deal after the market close on
Tuesday.
FOX UNPLUGS FROM ROKU AT
BIG DISCOUNT
FOX CORPORATION executed a poorly timed sale
of a long-held US$350m minority stake in
streaming service ROKU overnight on
Monday, less than two months after a bitter
content dispute between the two
companies.
&OXûCONlRMEDûLATEûONû4UESDAYûITûWASûTHEû
SELLERûOFûMû2OKUûSHARESûOFmOADEDûTHEû
previous evening in an unregistered block
trade via Morgan Stanley.
The media company quickly earmarked
the proceeds to help fund the simultaneous
US$440m acquisition of TUBI, a free ad-
supported streaming service.
In a statement, Fox said it was preserving
its balance sheet capacity by “essentially
exchanging a passively held minority
investment for control of a leadership
position in the free ad-supported streaming
market”.
Fox, the news, sports and broadcast
businesses spun off when Disney bought
20th Century Fox last year and now led by
media scion Lachlan Murdoch, paid a price
for its awful timing.
Morgan Stanley reoffered the 5% Roku
stake at US$58.00, towards the bottom of
the US$57.50–$59.00 reoffer range and a
wide 9.1% discount to last sale.
That price proved a bargain for the
buyside. Roku shares surged 8.8% Tuesday to
53ûANDûlNISHEDûTHEûWEEKûATû53
&OXûlRSTûINVESTEDûINû2OKUûINû ûNEARLYû
four years before its IPO was priced at US$14
a share in September 2017.
A low cost basis may explain why Fox was
willing to cut and run at such a big discount
and well below Roku’s high of US$176.55 in
September.
The unregistered format allowed Fox to
sell without the involvement of Roku
directly.
Earlier this year, the two were embroiled
in a Super Bowl-related carriage dispute
that saw Roku temporarily remove Fox
content/apps from its platform. The
dispute was resolved not long before game
kick-off.
Though the attractive discount may have
helped, one banker said the block showed
investors were still looking to put money to
work despite the coronavirus threat.
“The fact that so many people are
WORKINGûREMOTELYûHASûREALLYûBENElTEDû
companies like Roku,” the banker said.
SAFEHOLD TREADS WHERE
OTHERS FEAR TO GO
Ground lease REIT SAFEHOLD braved brutal
market conditions to raise roughly
53MûFROMûANûUPSIZEDûSTOCKûSALEûANDû
concurrent private placement, though it
was able to largely de-risk the exercise with
the support of an existing shareholder.
The public sale saw the REIT sell 1.3m
shares, up from 900,000 at launch, on an
overnight basis Tuesday at US$46.88 each or
a 5% discount to last sale.
Controlling shareholder and external
manager ISTAR bought another 1.7m shares
at the same price in a separate private
placement.
Safehold is using the proceeds to fund
further ground lease purchases, including
11 leases worth US$702.5m now under
various stages of negotiation.
Bank of America and Goldman Sachs led the
offering, which represented 6% of the
outstanding including the shares sold to
iStar.
JP Morgan, Barclays, Mizuho and SunTrust
Robinson Humphrey were added as joint
BOOKRUNNERSûINûTHEûlNALûRELEASE
Easing their task, an existing investor
bought all of the 900,000 shares offered in
the base deal.
Safehold shares proved resilient in
Wednesday’s after-market, closing at
US$46.91 or slightly above the offering
price.
It was all the more impressive since
Safehold shares surged 18.8% in the prior
session just ahead of the deal’s launch.
The owner of 66.2% of Safehold prior to
the offering, iStar wore some slight dilution
because the private placement comprised
57% of the total offering, down from 66%
under the terms envisaged at launch.
An owner of the land beneath buildings,
Safehold bills its investment premise as
COMPARABLEûTOûAûHIGH
GRADE ûlXEDûINCOMEû
investment.
h2ELATIVEûTOûALTERNATIVEûlXEDûINCOMEû
investments generally, our ground leases
TYPICALLYûBENElTûFROMûBUILT
INûGROWTHû
derived from contractual rent increases, and
THEûOPPORTUNITYûTOûREALIZEûVALUEûFROMû
residual rights to acquire the buildings and
other improvements on our land at no
ADDITIONALûCOSTûTOûUS vû3AFEHOLDSûlLINGû
stated.
Safehold last raised equity in November
when it sold 3m shares at much lower levels
(US$34 a share), with iStar buying another
3.8m shares at the same price on that
occasion.
KEROS SEEDS IPO BACKLOG
WITH NEW FILING
KEROS THERAPEUTICSûlLEDûPAPERWORKûLASTûWEEKû
for an US$86m IPO that will allow the blood
ECM DEALS: WEEK ENDING 20/3/2020
Stock Country Date Amount Price Deal type Bookrunner(s)
InnoCare Pharma China 16/03/2020 HK$2.2bn HK$8.95 IPO (Primary) Goldman Sachs, Morgan Stanley
Collector Bank Sweden 19/03/2020 SKr1.027bn SKr10 Rights issue SEB
Vifor Pharma Switzerland 16/03/2020 SFr192m SFr96 Accelerated bookbuild (Secondary) Goldman Sachs
Safehold US 17/03/2020 US$60.9m US$46.88 Accelerated bookbuild (Primary) Bank of America, Goldman Sachs
GLOBAL CONVERTIBLE OFFERINGS
BOOKRUNNERS: 1/1/2020 TO DATE
Managing No of Total Share
bank or group issues US$(m) (%)
Including exchangeables and domestic offerings.
Source: Refinitiv SDC code: C9
1 Goldman Sachs 12 3,281.31 13.5
2 JP Morgan 14 3,045.44 12.5
3 BofA Securities 9 3,018.89 12.4
4 Morgan Stanley 12 2,531.85 10.4
5 Barclays 5 1,171.71 4.8
6 Citigroup 6 1,167.55 4.8
7 Wells Fargo 2 848.86 3.5
8 BNP Paribas 3 701.80 2.9
9 UBS 3 565.78 2.3
10 CICC 3 557.34 2.3
Total 67 24,328.88
GLOBAL CONVERTIBLE OFFERINGS – US
BOOKRUNNERS: 1/1/2020 TO DATE
Managing No of Total Share
bank or group issues US$(m) (%)
Source: Refinitiv SDC code: C9a
1 Goldman Sachs 9 2,665.53 23.1
2 BofA Securities 8 2,646.86 22.9
3 JP Morgan 7 1,702.20 14.7
4 Morgan Stanley 7 1,293.03 11.2
5 Wells Fargo 2 848.86 7.3
6 Barclays 3 693.33 6.0
7 Jefferies 2 248.75 2.2
8 Truist Financial Corp 2 151.36 1.3
9 Citigroup 2 151.36 1.3
10 RBC 1 150.00 1.3
Total 20 11,557.98
10 IFR Equities and SE 2325 p 73 - 81 .indd 80 20 / 03 / 2020 19 : 37 : 50