SoftBank derisks Wirecard investment with startling CB arb

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By Aidan Gregory, Jon Hay
19 Sep 2019

SoftBank, the Japanese technology conglomerate, astonished equity-linked bond market participants this week by executing a deft trade, arranged by Credit Suisse, that recovered all its €900m investment in Wirecard, the controversial German payments processing company, while leaving it with upside. Aidan Gregory and Jon Hay report.

Using a Credit Suisse vehicle, SoftBank issued a €900m bond exchangeable into Wirecard shares at a much higher share price than the one SoftBank had agreed to invest at. The deal protects SoftBank from Wirecard’s credit risk, but leaves it with most of the equity upside.

“The transaction ...

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