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The derailed Neptune deal

What a difference a year makes. As the results of Asiamoney's 12th best-managed companies poll show, investors are impressed by the increasing confidence of corporates and their return to healthy earnings. Poll compiled by Olivia Chow and Robert Law. Report by Keri Geiger.

It took seven banks, six days and a lot of hype to launch the biggest corporate bond ever to hit the Asia ex-Japan market. In November, Hutchison Whampoa, the Hong Kong-based conglomerate and telecom company, brought the Asian bond markets to their knees by offering investors a multi-tranche, US$5-billion bond. With US$13 billion in book orders, investors could not snatch up the Hutchison paper fast enough. Citigroup, HSBC, Merrill Lynch and Goldman Sachs shared the glory, acting as joint lead managers on the all three tranches with Deutsche Bank also participating in the seven-year, JP Morgan on the 10-year and Morgan Stanley in the 30-year tranche.

Korean electricity utility Kepco raised US$250 million in November in an exchangeable/going-public bond structure that harks back to the landmark KDIC dual exchangeable of July 2001. Kepco hired ING and Good Morning Shinhan Securities to sell the bonds, which potentially monetize a significant portion of its 43% stake in one of the country's leading communication network services providers, Powercomm.

It seems quite extraordinary that a capital market as developed as Malaysia's should never have seen a local currency equity-linked bond issue. But that was the case until Malaysian conglomerate Multi-Purpose Holdings sold a M$300-million (US$78.9 million) exchangeable bond in November, the first equity-linked bond issue in Malaysian dollars. “There have hardly been any equity-linked bond issues from Southeast Asia, in local or foreign currencies,” notes Sanjay Arora, head of Asian convertibles at Deutsche Bank, which managed the transaction. “But convertible bonds are ideal for companies to raise low cost funds and to sell equity forward at a premium. And the exchangeable is tailor made for monetizing other shareholdings.”

Syndicated loans, equity, debt and M&A

Sony sold a convertible bond issue with a difference in early December. The TVs to microchips maker proved itself a savvy capital markets player when it hired Goldman Sachs and Merrill Lynch to sell a ¥250-billion Euroyen CB that avoids earnings per share dilution.

-- Lawrence Yarberry, Pacer International's executive v.p. and cfo, on the repricing of its bank debt by Deutsche Bank.

An early Christmas gift request from the buyside... "What we really need is a bankruptcy, or a company to get into real trouble," said one loan manager, looking for some of the repricing pressure to ease.

Consolidated Graphics chose Bank One to lead its new $150 million credit line over the incumbent Wachovia Bank due to the bank's better fit with the company.

Pricing could be flexed down on Montreal-based Alimentation Couche-Tard's bank deal that hit the market two weeks ago, market players said.