• U.S. market convertibles issuance totals $794 million year to date
By Rebecca Melvin
New York, Feb. 27 - Citigroup Global Markets Inc. and J.P. Morgan Securities Inc. unseated Deutsche Bank Securities Inc. as top underwriter of U.S. convertibles for the year to date, but the coup seems hardly noteworthy given that the shuffle was due to exercising a greenshoe and the amount of new issuance overall is so meager.
Total new issuance rose to $794 million for the year to date at the end of February, compared to $700 million for the year to date at the end of January, according to data compiled by Prospect News.
In February, there was only one small $25 million deal priced, namely EpiCept Corp.'s five-year convertible senior subordinated notes, plus warrants.
The registered offering was placed via Rodman & Renshaw LLC, a subsidiary of Rodman & Renshaw Capital Group.
One interesting note is that EpiCept is a specialty pharmaceutical company based in Tarrytown, N.Y., which is also the home base of Environmental Power Corp., a company currently on the very-thin forward calendar.
Newmont Mining Corp.'s $450 million of convertibles, which priced Jan. 27, accounts for more than half of new issuance for the year to date. That deal was split between Citigroup and JPMorgan.
New issuance virtually shutdown last autumn in response to the credit and financial market turmoil and the bankruptcy filing of Lehman Brothers Holdings Inc.
The $794 million of new issuance in four deals for the first two months of the year pales in comparison to the $15.3 billion in 21 deals tallied for the first two months of 2008.
Average deal size was pulled down to $265 million in February from $350 million in January.
The Newmont convertibles were upsized to $450 million from $350 million, and they are short dated, coming due Feb. 15, 2012.
Year to date
2008 Comparables
| Underwriter | Amount | No. | Share | Rank | Amount | No. | Share
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| 1 | Citigroup | 0.259 | 1 | 32.57% | 2 | 3.492 | 4 | 22.77%
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| 1 | JPMorgan | 0.259 | 1 | 32.57% | 7 | 0.312 | 2 | 2.04%
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| 3 | Deutsche Bank | 0.252 | 1 | 31.71% | 11 | 0.083 | 1 | 0.54%
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| 4 | Rodman | 0.025 | 1 | 3.15% |
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| Total | 0.794 | 3 | 15.335 | 21 |
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| Average size: | 0.265 | 0.730 |
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| February
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| | | | | 2008 Comparables
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| Underwriter | Amount | No. | Share | Rank | Amount | No. | Share
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| 1 | Rodman | 0.025 | 1 | 100.00% |
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| Total | 0.025 | 1 | 2.021 | 11 |
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| Average size: | 0.025 | 0.184 |
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| Prospect News Convertibles Underwriter Rankings
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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.
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