Allegheny cold-rolled on US$250m CB

摘要

When funding options are limited, companies can almost always turn to the convertible bond market. While not quite out of options, speciality steel manufacturer Allegheny technologies looked to a US$250m six-year senior unsecured CB to bolster liquidity through a period of difficult operating results. The financing was not quite the panacea that the company (and the underwriting banks) had hoped for. Citigroup, ]P Morgan and Bank of America Merrill Lynch finalised pricing at 4.75%, up 25%, the worst end of 4.2556-4.75% and 25%-30% price talk for the issuer. The banks marketed the deal on Wednesday at a credit spread of L+1,000bp and implied vol of 45. Allegheny shares fell 18.4% on the marketing to US$11.56, versus a 52-week high of US$35.88 last May and low of US$7.08 in January.