Overview of Norwegian Capital Markets – Speed Dating 101 DNB Markets | Investment Banking Division Jae Kwon, Managing Director June 19, 2014 Strictly private and confidential | Norwegian Capital Markets – Introduction An opportunistic and efficient solution for raising capital: ~$27 billion in total capital raised from 2013 – 2014 YTD Equity Equity raised on the N-OTC market and OSE* from Debt 2013 – 2014 YTD: ~$11 billion ~$2 billion from the shipping sector Norwegian HY Bonds offer flexible structures, simple a short window of time (4-6 weeks) with limited straight forward documentation, efficient execution registration requirements and “lite” documentation** process (4-6 weeks) and require no official credit rating The Norwegian equity markets lead in first-time issuers with a 60% market share (2013 – 2014 YTD) from 2013 – 2014 YTD: ~$16 billion ~$5 billion from the shipping sector Private Placement / N-OTC listings can be executed in Debt raised in the Norwegian High Yield Bond Market Many first-time issuers listed on the N-OTC will look to Total market of ~$30 billion with ~60% outstanding issued in NOK and ~35% issued in USD*** IPO on major exchanges in the near future * Norwegian Over-the-counter Market and Oslo Stock Exchange ** Private Placement / Norwegian Over-the-counter listing transactions typically follow with an IPO on a major exchange within 12 months *** ~5% issued in other currency 2| The Private Placement / N-OTC Competitive Advantage 1) Opportunistic capital available based on market sentiment 2) Can be executed in 4-6 weeks 3) No requirement for public disclosure of intention to float or deadlines from regulators 4) Limited formal registration requirements: 1 year history, ~50 shareholders, market cap > NOK 20m 5) Limited documentation required: Investor Presentation, Term Sheet & Application Agreement 6) No Norwegian content required Note: Private Placement / Norwegian Over-the-counter listing transactions typically follow with an IPO on a major exchange within 12 months 3| The Majority of Equity is Raised in the United States, but 60% of First-time Issuers Tap the Norwegian Equity Markets Total transaction volume by stock exchange First-time issuer transaction volume by stock exchange Other 36% USDm 57% 7% 7,875 8,000 60% USDm 8,000 7,000 7,000 6,000 6,000 5,000 5,000 4,000 40% 4,000 3,637 3,000 3,000 2,000 2,000 1,216 917 1,000 0 1,694 1,000 1,609 638 0 N-OTC Oslo Stock Exchange US Other1 N-OTC Oslo Stock Exchange US Other1 1 Other foreign exchange or private transactions Source: DNB Markets statistics collected from a variety of sources including company press releases, Tradewinds, Marine Money and other news sources 4| Norwegian Equity Issues 2013 – 2014 YTD for Shipping Companies Total equity raised for shipping companies on the N-OTC and OSE 2013 – 2014 YTD: ~$5 billion ~75% of these companies have no affiliation to Norway Issuer Avance Gas Holding Ltd. Navig8 Crude Tankers Tanker Investments Ltd. Pioneer Marine Dorian LPG Ltd. Epic Gas Aurora LPG American Shipping Company Tanker Investments Ltd. Navig8 Crude Tankers Inc. Hafnia Tankers American Shipping Company BW LPG Limited Scorpio Bulkers Inc Dorian LPG Ltd. Navig8 Product Tankers Hafnia Tankers Western Bulk Scorpio Bulkers Inc Frontline 2012 Ltd. Navig8 Product Tankers Dorian LPG Ltd. Belships ASA Scorpio Bulkers Inc Greenship Bulk Trust Frontline 2012 Ltd. Total Sector LPG Crude tank Crude tank Dry bulk LPG LPG LPG Product tank Crude tank Crude tank Product tank Product tank LPG Dry bulk LPG Product tank Product tank Dry bulk Dry bulk Mix Product tank LPG Dry bulk Dry bulk Dry bulk Mix Deal Type IPO FO IPO PP PP PP PP FO PP PP PP PP IPO PP PP PP PP IPO PP PP PP PP RO PP PP PP Deal Value $ (m) 250 245 175 75 100 75 150 18 250 160 75 120 511 300 250 150 235 127 300 225 170 168 15 250 61 297 $4,752 Date Apr-14 Mar-14 Mar-14 Mar-14 Feb-14 Jan-14 Jan-14 Jan-14 Jan-14 Dec-13 Dec-13 Dec-13 Nov-13 Nov-13 Nov-13 Oct-13 Oct-13 Oct-13 Sep-13 Sep-13 Apr-13 Jul-13 Jul-13 Jul-13 Jun-13 Jan-13 Exchange OSE NOTC OSE NOTC NOTC NOTC NOTC OSE NOTC NOTC NOTC OSE OSE NOTC NOTC NOTC NOTC OSE NOTC NOTC NOTC NOTC OSE NOTC NOTC NOTC 5| The Norwegian HY Bond Market is an Attractive Source of Debt Financing 1) Flexible structuring (size, tenor, credit quality) 2) No official credit rating required 3) Simple straight forward documentation 4) Efficient execution process (time to market of ~4-6 weeks) 5) Global investor base 6) Increasingly active secondary market 6| Norwegian HY Issue Volume YTD 2014 Above Record Year 2013 12,000 2013 USD 10.1bn 10,000 8,000 2012 USD 7.1bn USDm YTD 2014 USD 6.5bn 6,000 2011 USD 4.1bn 4,000 2010 USD 3.9bn 2009 USD 2.3bn 2,000 2008 USD 0.9bn 0 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Source: Stamdata and DNB Markets As of 6/16/2014 7| Norwegian Bond Issues 2013 – 2014 YTD for Shipping Companies Total Norwegian Bond issues for shipping companies 2013 – 2014 YTD: ~$2 billion Trade date Issuer 6/4/2014 4/24/2014 4/10/2014 3/28/2014 3/10/2014 3/7/2014 3/5/2014 3/3/2014 12/13/2013 12/6/2013 9/17/2013 8/27/2013 6/13/2013 6/3/2013 6/3/2013 4/23/2013 4/12/2013 3/12/2013 1/31/2013 1/17/2013 1/17/2013 Total Odfjell SE GasLog Ltd Cecon Shipping 1 AS Wilh. Wilhelmsen Klaveness Ship Holding AS Ridgebury Crude Tankers LLC Ship Finance International Limited Stolt-Nielsen Limited Olympic Shipping AS Color Group ASA Odfjell SE Teekay LNG Partners GasLog Ltd Tallink Group Wilh. Wilhelmsen Klaveness Ship Holding AS Western Bulk AS DFDS A/S Fjord Line AS Eitzen Chemical ASA Eitzen Chemical ASA Currency Amnt (mm) NOK NOK USD NOK NOK USD NOK NOK NOK NOK NOK NOK NOK NOK NOK NOK NOK NOK NOK NOK USD 300 500 55 800 400 210 900 1250 100 700 400 900 500 900 700 300 300 700 300 250 12 Amnt in USDmm $50 83 55 134 67 210 150 209 17 117 67 150 83 150 117 50 50 117 50 42 12 $1,980 Tenor (yrs) Coupon 4.5 4.2 1.2 5.0 6.0 3.0 5.0 7.0 1.1 4.0 2.2 5.0 5.0 5.0 5.0 5.0 4.0 5.0 3.0 3.0 3.0 FRN FRN Zero FRN FRN Fixed FRN FRN FRN FRN FRN FRN FRN FRN FRN FRN FRN FRN FRN FRN FRN 8| The Norwegian Capital Markets – Conclusion 1) Opportunistic 2) Fast 3) Flexible 4) Documentation “lite” 5) Limited regulatory hurdles 6) No Norwegian passport required 9| Disclaimer This presentation is strictly confidential and prepared exclusively for the benefit and internal use of our client to whom it is directly addressed and delivered (including such client’s subsidiaries, the “Company”) and not for distribution or publication. The information may not be reproduced without the consent of DNB Markets. The information in this presentation is based upon any management forecasts supplied to us by the Company and publicly available information. We have relied upon and assumed, without independent verification, the accuracy and completeness of all information available. DNB Markets opinions and estimates constitute DNB Markets’ judgment and should be regarded as indicative, preliminary and for illustrative purposes only. Statements in the presentation reflect prevailing conditions and DNB Markets’ opinion at the date the presentation was prepared, all of which are accordingly subject to change. DNB Markets does not warrant that the information in the presentation is exact, correct or complete. The presentation is for discussion purposes only and is incomplete without reference to, and should be viewed solely in conjunction with, oral briefing provided by DNB Markets. Our analyses are not and do not purport to be appraisals of the assets, shares, or business of the Company or any other entity. DNB Markets makes no representation as to the actual value which may be received in connection with a transaction nor the legal, tax or accounting effects of consummating a transaction. Unless expressly contemplated hereby, the information in this presentation does not take into account the effects of a possible transaction or transactions involving an actual or potential change of control, which may have significant valuation and other effects. This presentation is not an offer or a recommendation to purchase or sell financial instruments or assets, and does not constitute a commitment by DNB Markets to underwrite, subscribe for or place any securities or to extend or arrange credit to or to provide any other services. DNB Markets does not accept any responsibility for direct or indirect losses that are due to the interpretation, and/or use, of this presentation. DNB Bank ASA and/or other companies in the DNB group or employees and/or officers in the group may be market makers, trade or hold positions in instruments referred to or connected therewith, or provide financial advice and banking services in this connection. Rules regarding confidentiality and other internal rules limit the exchange of information between different units in DNB Bank. Employees in DNB Markets who have prepared this presentation are therefore prevented from using, or being aware of, information in DNB Bank and other companies in the DNB group which may be relevant to this presentation. This presentation has been prepared in accordance with the general business terms of DNB Markets, a division of DNB Bank ASA, available at dnb.no/markets. 10 |
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