Citigroup's new issuance lead widens in September; credit crunch slows new issuance for the month

• Convertibles issuance totals $70.1 billion year to date

By Evan Weinberger

New York, Sept. 28 - Citigroup widened its lead in year-to-date convertibles new issuance over second-placed JPMorgan in September. But JPMorgan took the title for the third quarter and Merrill Lynch edged out Citigroup for first place in September. New issuance slowed to a trickle for the month, according to data compiled by Prospect News.

Citigroup saw its lead in new issuances over JPMorgan spread in September. For the year, Citigroup has been at least a joint bookrunner on 32 deals totaling $10.8 billion, representing 15.41% of total new issues so far in 2007. Citigroup maintained its first-place position from this point last year, when it raised $8.563 billion in 23 deals, representing 18.53% of total new issuance through the third quarter of 2006.

JPMorgan placed first in the third quarter of 2007, raising $2.206 billion through 8 deals, representing an 18.35% share of total new issuance. Citigroup came in second, raising $2.018 billion in 7 deals, representing 16.79% of total new issuance in the third quarter. Lehman Brothers came in a close third, raising $1.938 billion in three deals representing a 16.12% share in third quarter new issuance.

New issuance for the third quarter of 2007, $12.022 billion in 29 deals, sprinted ahead of the third quarter of 2006, which saw $10.363 billion raised in 31 deals.

Total new issuance for 2007 is far outpacing total new issuance for 2006, despite the credit woes. Year-to-date in 2007, $70.083 billion has been raised in 160 new deals. At the end of the third quarter of 2006, $46.202 billion had been raised in 101 new deals.

But the average size of new deals so far in 2007 is off from last year's pace. Year-to-date new deals have come in at an average of $438 million dollars in 2007, a touch below the 2006 average of $457 million.

Merrill Lynch made a late push to finish first in September, raising $415 million in one deal, General Cable Corp.'s 1% senior convertible notes due Oct. 15, 2012. That one deal represented 24.79% of total new issuance for September. Citigroup placed second in September, raising $396 million in one deal, representing 23.66% of new issuance for the month, Equinix Inc.'s $350 million in 3% convertible subordinated notes due Oct. 15, 2014.

The $1.674 billion in seven deals in September 2007 was a steep decline from the $5.794 billion issued in 17 deals issued in September 2006, a drop off that came as the credit squeeze took hold. Average deal size was also down in September 2007, $239 million, versus September 2006, $341 million.

Deutsche Bank maintained its third place position for 2007, raising a total of $7.987 million in 21 deals, representing 11.40% of the total new issuance. Deutsche Bank placed sixth in the third quarter, raising $666 million in three deals, representing 5.54% of the total new issuance for the quarter.

The gap between the top two bookrunners, Citigroup and JPMorgan, widened to $618 million in September. The gap had thinned to $321 million in August.

The Prospect News figures cover dollar-denominated deals offered in the United States as registered transactions or under Rule 144A.

Year to date

2006 Comparables

	Underwriter	Amount	No.	Share	Rank	Amount	No.	Share
1	Citigroup	10.800	32	15.41%	1	8.563	23	18.53%
2	JPMorgan	10.182	39	14.53%	6	3.913	21	8.47%
3	Deutsche Bank	7.987	21	11.40%	9	1.581	8	3.42%
4	Morgan Stanley	7.644	14	10.91%	3	5.595	18	12.11%
5	Banc of America	5.931	30	8.46%	5	4.114	26	8.90%
6	Merrill Lynch	5.460	23	7.79%	2	7.277	30	15.75%
7	Lehman	4.923	17	7.02%	8	3.463	9	7.50%
8	Credit Suisse	4.387	16	6.26%	10	1.515	13	3.28%
9	Goldman Sachs	4.379	21	6.25%	4	4.149	15	8.98%
10	UBS	2.927	18	4.18%	7	3.534	15	7.65%
	Total	70.083	160	46.202	101
	Average size:	0.438	0.457
Third quarter
					2006 Comparables
	Underwriter	Amount	No.	Share	Rank	Amount	No.	Share
1	JPMorgan	2.206	8	18.35%	5	0.982	8	9.47%
2	Citigroup	2.018	7	16.79%	1	3.202	6	30.90%
3	Lehman	1.938	3	16.12%	10	0.259	2	2.50%
4	Goldman Sachs	0.985	4	8.19%	3	1.186	4	11.44%
5	Banc of America	0.983	6	8.18%	4	1.131	8	10.91%
6	Deutsche Bank	0.666	3	5.54%	7	0.503	4	4.86%
7	UBS	0.625	3	5.20%	9	0.300	1	2.89%
8	Friedman Billings	0.500	1	4.16%
9	Morgan Stanley	0.500	1	4.16%	8	0.476	2	4.59%
10	Bear Stearns	0.500	1	4.16%	13	0.115	1	1.11%
	Total	12.022	29	10.363	31
	Average size:	0.415	0.334
September
					2006 Comparables
	Underwriter	Amount	No.	Share	Rank	Amount	No.	Share
1	Merrill Lynch	0.415	1	24.79%	5	0.444	5	7.67%
2	Citigroup	0.396	1	23.66%	1	2.575	2	44.44%
3	Goldman Sachs	0.250	1	14.94%	4	0.460	3	7.94%
4	Wachovia	0.250	1	14.94%
5	Deutsche Bank	0.148	1	8.83%	7	0.273	3	4.72%
6	JPMorgan	0.098	2	5.88%	6	0.350	4	6.04%
7	Jefferies	0.050	1	2.99%
8	Credit Suisse	0.033	1	1.99%	3	0.552	6	9.53%
9	Banc of America	0.033	1	1.99%	2	0.791	5	13.66%
	Total	1.674	7	5.794	17
	Average size:	0.239	0.341
Prospect News Convertibles Underwriter Rankings

Criteria

• The tables include all underwritten dollar-denominated offerings sold in the United States as public or Rule 144A deals reported to Prospect News.

• Offerings are included in the time period in which they price.

• Amounts are based on the total sales price (face amount multiplied by the offering price). The full amount is credited to the bookrunner (or lead manager if no bookrunners). For multiple bookrunners (or lead managers), the total value is divided equally among all the firms.

• Each tranche is counted as a separate deal.

• Bonds are included that convert into the issuer's or another company's stock or the cash equivalent; bonds that convert into other bonds are excluded.

• Structured products issued by an investment bank and exchangeables for or linked to another company's stock are excluded.

• Units made up of a bond and stock are included; units made up of a bond and warrants are excluded.

• Preferred issues are included using the same criteria as for bonds.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.