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On the road - marketing DEPFA Bank's $1.5 billion extendible issue Back  
Jackie Hughes describes her recent roadshow in the United States, which saw her visit New York, Charlotte, Boston, and New Hampshire, marketing a DEPFA Bank US$1.5 billion extendible issue, the first time DEPFA acted as a co-selling agent on a re-financing bond issue.
IIIIt is Sunday and I’m back in the airport, having left it as recently as Thursday on my way back from Asia. On that occasion, I had the misfortune to misplace my car park ticket (first time in nine years) and informed Aer Rianta’s exit personnel that my car had been parked for one week. ‘Not so,’ said a disjointed telephone voice, ‘that car has been here for over a month’. Counterfoil of current ticket was produced as proof and backed up with the acknowledgement that said car had indeed graced Aer Rianta’s car park on at least six occasions that month, but separate occasions.

This time it’s a deal- related road show, as Ralf Loewe, associate director, Karen Ewenson, associate director, and myself, head to the Big Apple on the first leg of a US trip to market a DEPFA US$ extendible issue. For the first time DEPFA is co-selling agent on a re-financing bond issue, and our series of planned investor visits with the bookrunner will give us important feedback on investor appetite for the product and preferred structure. It will also give us the opportunity to talk to investors about strategic goals, and the planned sale of our German subsidiary.

Sunday, May 9th
Clear US immigration in Dublin feeling very relieved that I never overstayed a J1 visa!
Highlight of the flight is the Aer Lingus cocktail sausages on sticks. Run through presentation again and first quarter figures that were released the previous week.

Arrive JFK, through customs, straight to the hotel where I meet a colleague to discuss the following days meetings. Crash at 8pm

Monday, May 10, New York City
Early start to meet our partners in the transaction and move on to meet our first institutional investor. We already know most of the investors we will see and talk to over the next week as we sell erodollar CDs directly to many large money funds in the US; the atmosphere of the first meeting sets the tone for the week, friendly and open.

Time is tight. US investors/ analysts really like to take advantage of having an issuer in front of them to ask in depth questions on P&L, business strategy, transition etc. It makes for great interactive meetings, but puts pressure on our schedule for the day.

Second NY meeting made us feel very much in demand with six participants from the investor side. Late morning we headed to New Jersey where several firms have relocated after September 11, 2001. There we discovered that some Jersey residents were not aware of the existence of ‘old’ Jersey. ‘Channel Islands? Never heard of them’!

Tuesday May 11, New York City
Heavy day with four very big meetings with investors back to back, and two conference calls with investors on the West Coast. As we move through the day with meetings alternating with conference calls, the benefit of having an existing relationship with investors is obvious. Many credit lines are already in place; some we will need to have increased to allow for product diversification with us, and the maturity on some of the lines will need to be extended. This is the work for the analysts while the portfolio managers usually concentrate on the product and its structure.

Wednesday May 12
It’s off to Charlotte, North Carolina, after being ‘randomly selected for extra airport security screening’ at La Guardia. Is it because we are foreign we ask? No indeed, we are assured, it’s random computer selection. So if you see an ‘S’ stamped on a boarding pass in the US, it’s not because you are special.

Charlotte, sleepy and charming, with great fish cakes and the first sprinkling of rain in days. Our first meeting is interrupted by the ‘spring fire drill’ so we continue on the street below in the rain.
Finally it’s goodbye to Charlotte and on to Boston, arriving very late so the harbour holds no allure.

Thursday, May 13
One-to-one investor meeting, with video links from other parts of the US and London. Immediately afterwards we go back to Logan Airport to catch the New York shuttle for two more investor meetings in NYC and return again to Boston getting the same ‘special’ treatment at La Guardia. Arrive back at our Boston hotel feeling a little weary but the end is in sight. Tomorrow is the last day of the roadshow and so far the investor feedback has been extremely positive, so we relax a bit with some local lobster and a glass of wine. Needless to say, conversation is deal related.

Friday, May 14
We set off for New Hampshire by car and arrive early for the meeting with the investor who is located pretty far from the beaten track. I had forgotten that the only watering hole close by is a MacDonald’s where we indulge in sausage Mac Muffins and some weak coffee.

Our investor is very hospitable, understanding that visitors travel significant distances to see them, offering us a healthy, low fat, post-Mac Donald’s breakfast. This is a long meeting, with analysts linked in by video and several portfolio managers participating. Some of the PMs knew us very well, but for others it was a first meeting with DEPFA.

Although we cover the same material at each meeting, companies will often come at things from a different angle and differ from each other on the parts of the presentation they want to focus on.
Back in the car, heading for Boston with the last meeting behind us. A quiet car journey; it’s been a good week. Do we have time for some retail therapy before our evening flight to Dublin? Maybe just a little.

Monday 17 May
Adrenalin rushing again, the deal is launched with ongoing conference calls late in to the evening Monday and Tuesday with book-runners and the investors, to firm up pricing and the mechanics of the deal.

By Wednesday, the issue was oversubscribed and we increased the issue size from USD $1 billion to USD $1.5 billion. A job well done by all, and by Monday, it’s back to the airport again.

The USD $1.5 billion issue was DEPFA’s first extendable benchmark issue. The transaction has a final maturity of five years and an initial maturity of 13 months.

Each March, June, September, and December, from September 2004, an investor will have the right to extend the maturity date by another year. DEPFA BANK acted as co-selling agent alongside Morgan Stanley.

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