GROUP shares at the bottom of a ¥4,809–
¥4,846 range.
The final price represents a 2.3%
discount to the September 5 close of
¥4,920.
The response to the offer was strong with
demand from hedge funds and long-only
institutions.
The shares sold represent 0.6% of the
company’s share capital.
There is a 60-day lock-up for the selling
shareholder.
Nomura was the sole bookrunner.
MALAYSIA
DEBT CAPITAL MARKETS
› PRASARANA FINDS SOLID DEMANDPRASARANA MALAYSIA last Monday raised
M$1bn (US$242m) in four tranches of
Islamic bonds that attracted solid demand.
A M$150m three-year tranche was pricedat par to yield 3.94%, a M$300m five-year
tranche will pay 4.03%, a M$150m seven-
year tranche will pay 4.16% and a M$400m
10-year tranche will pay 4.32%.
The respective tranches were marketed
at initial price guidance of 3.91%-3.96%,
4.05%-4.10%, 4.16%-4.21% and 4.34%-4.39%.
The deal, guaranteed by the government
of Malaysia, was 4x oversubscribed.
Demand was strongest for the 10-year
sukuk, allowing the state-owned public
transportation company to price the
tranche inside initial guidance.
Bankers said the supply of government-Top bookrunners of all Malaysian ringgit bonds
1/1/18 – 31/8/18
Amount
Name Issues M$(m) %
1 CIMB Group 26 10,695.2 19.0
2 RHB 25 10,355.6 18.4
3 Maybank 31 9,112.1 16.2
4 AMMB 24 8,138.3 14.4
5 Affin 7 1,867.5 3.3
6 K&N Kenanga 16 1,786.2 3.2
7 HSBC 2 1,100.0 2.0
8 OCBC 3 995.2 1.8
9 Bank Islam Malaysia 2 845.2 1.5
10 Hong Leong Financial 6 641.8 1.1
Total 104 56,342.0
*Market volume
Proportional credit
Source: Thomson Reuters SDC Code: AS8
Top bookrunners of Malaysia syndicated loans
1/1/18 – 31/8/18
Amount
Name Deals US$(m) %
1 Mizuho 2 2,051.7 20.7
2* UOB 1 2,000.0 20.2
2* Standard Chartered 1 2,000.0 20.2
2* HSBC 1 2,000.0 20.2
5* Citigroup 2 263.4 2.7
5* MUFG 2 263.4 2.7
5* BNP Paribas 2 263.4 2.7
8* Deutsche 1 211.7 2.1
8* First Abu Dhabi Bank 1 211.7 2.1
8* CBA 1 211.7 2.1
Total 6 9,890.3
* Based on market of syndication and market total
Proportional credit
Source: Thomson Reuters SDC Code: S14bMalaysia global equity and equity-related
1/1/18 – 31/8/18
Amount
Name Issues US$(m) %
1 CIMB Group 4 252.0 18.0
2 JP Morgan 2 234.7 16.8
3 Maybank 3 147.0 10.5
4 RHB 9 138.0 9.9
5 BNP Paribas 1 128.6 9.2
6 K&N Kenanga 8 83.2 5.9
7 Mercury Sec 13 57.1 4.1
8 M and A Sec 13 56.1 4.0
9 Affin 2 55.9 4.0
10 TA Sec 13 46.7 3.3
Total 87 1,400.5Source: Thomson ReutersLine floats CBs to fund fintech, AI
Structured Equity Recent successes draw tech firms to convertsJapanese messaging app company LINE
raised ¥73.16bn (US$657m) from a public
dual-tranche convertible bond last week in
the largest euroyen CB of the year.
Line, which is listed in Tokyo and New York
and is a subsidiary of South Korea’s Naver,
split the Reg S issue equally between five-
year and seven-year tranches.
The ¥36.58bn five-year zero-coupon CB
priced at a conversion premium of 47% over
the company’s closing price of ¥5,080 last
Tuesday, the mid-point of an indicative range
of 42%–52%. The ¥36.58bn seven-year zero-
coupon CB came at the top of an indicative
conversion range of 38%–48%.
Both tranches have an issue price of 100%
and an offer price of 102.5%.
In addition to the public issue, Line raised
another ¥73.16bn from a private placement
of five and seven-year CBs to its parent
company Naver at the same terms as the
marketed CB but at an issue price of 102.5%
of the principal amount.The public offering attracted strong
demand with the five-year tranche three
times covered while the seven-year was
more than two times covered. The seven-
year bond drew more than 100 investors
while the five-year one had close to 100
investors. The top 10 investors took about
50% of the paper.
Japanese issuers have been coming to the
CB market in the past few months to raise
funds for their technology development. In
late August, financial services company SBI
Holdings sold a ¥50bn euroyen CB to fund
investments in fintech, AI, blockchain and
digital asset-related businesses.
“The positive response to the SBI CB and
a few other domestic CBs from Japanese
internet companies recently have given
confidence to other tech issuers,” said a
person close to the Line deal. “We think more
tech companies will consider selling CBs
as rising interest rates will raise the cost of
selling bonds.”Line plans to use two-thirds of the
proceeds for investments in fintech
businesses and one-third for investments in
AI businesses by December 2021.
The credit spread assumption on the five-
year bond was 80bp, with bond floor at 95.4
and implied volatility at 29%. For the seven-
year tranche, credit spread was assumed at
100bp, with a bond floor of 91.8 and implied
volatility at 29%.
To facilitate the transaction, lead
managers provided asset swaps at 70bp–
80bp for the five-year and 90bp–100bp for
the seven-year.
In the gray market, the five-year bonds
changed hands at the offer price plus 0.25
and the seven-year bonds at the offer price
plus 0.75 immediately after launch.
JP Morgan, Morgan Stanley and Nomura
were active bookrunners for the deal.
Goldman Sachs and Mizuho were passive
bookrunners.
FIONA LAU, HIROKO YONEDA