Upsized Deals Bring in Big Bucks for Issuers

Strategic Insights -

Despite initial concerns, several deals managed to substantially increase their requested amounts, resulting in a profitable week for issuers. Royal Numico N.V. and Origin Energy saw their deals upsized, with Royal Numico increasing its requested $300 million to $450 million and Origin Energy's $150 million being raised to $350 million. These deals were structured across multiple tranches with varying interest rates. The issuers, who have decent credit ratings, were able to tap into the market for more capital than initially expected.

Key Takeaways:

  • Royal Numico N.V. upsized its deal from $300 million to $450 million, with Deutsche Bank as the sole agent.
  • The deal was structured across four tranches with interest rates ranging from 85 to 105 basis points over Treasurys.
  • Origin Energy's deal was upsized from $150 million to $350 million, with Banc of America Securities as the agent.
  • The placement was structured across four tranches, with interest rates ranging from 50 to 105 basis points over Treasurys.
  • Transurban Group's deal was also upsized from $250 million to $320 million, with BAS as the agent.
  • The deal consisted of three tranches, with interest rates ranging from 98 to 156.5 basis points over Treasurys.
  • Royal Numico N.V. is a public company listed on the Euronext Stock Exchange in Amsterdam under the ticker symbol NUM.
  • Origin Energy is the second-largest retailer of natural gas, electricity, and liquefied petroleum gas in Australia, with two million customers.
  • Transurban is a toll road group with a credit rating of A3' and A' by Moody's Investors Service and Standard & Poor's, respectively.

Statistics:

  • Royal Numico N.V. raised $150 million more than initially requested. ($450 million - $300 million = $150 million)
  • The deal was structured across four tranches, with a total of 1 seven-year bullet, 1 nine-year bullet, 1 ten-year bullet, and 1 twelve-year bullet.
  • Origin Energy raised $200 million more than initially requested. ($350 million - $150 million = $200 million)
  • The placement was structured across four tranches, with a total of 1 seven-year bullet, 1 nine-year bullet, 1 ten-year bullet, and 1 twelve-year bullet.
  • Transurban Group raised $70 million more than initially requested. ($320 million - $250 million = $70 million)
  • The deal consisted of 3 tranches: 1 ten-year bullet, 1 twelve-year bullet, and 1 fifteen-year bullet.

Sources:

  • Private Placement Letter and SourceMedia, Inc.
  • Deutsche Bank
  • Banc of America Securities
  • Fitch Ratings
  • Moody's Investors Service
  • Standard & Poor's
  • Euronext Stock Exchange
  • Australian Stock Exchange