JWCA advises csg systems international on its $230 million convertible bond offering
march 2016 | read press release
Transaction Background
J. Wood Capital Advisors was hired by CSG Systems International to evaluate its capital structure, then execute a new convertible issuance in a smarter, more efficient manner:
Provided complete capital structure analysis related to:
actics for refinancing existing convertible
Managing liquidity over the next 5 years
Impact on interest expense and net dilution
Net stock trading impact from hedge funds in the transaction
Optimal timing considerations
Designed the strategy and execution process to meet the company's objectives:
Raised significant cash for refinancing, lowered the underlying, shares, raised the conversion premium materially, and extended the maturity of the convertible profile by 19+ years
Assisted the team with documentation, accounting, and tax review
Provided advice, support and analysis during the execution
“Jason and Katy spent a considerable amount of time working with our team to review and advise on our overall capital structure. Their detailed analysis of our capital structure led them to advise a convertible issuance and simultaneous repurchase, which included a complete analysis related to refinancing tactics for the convertible. During the entire process, they were an extension of our team; and importantly, they were with us during the week of execution - providing advice, analysis, and support during the negotiations with investors.”
Results
The company executed a successful liability management exercise:
riced near the company-friendly end of the price range
.25% coupon vs 4.125 - 4.625% range
40.0% conversion premium vs 37.5 - 42.5% range
Repurchased 70.7% of its existing 3.00% convertible due 2017
CSGS stock rose +6.5% on the day of execution