April 14, 2021
Subs -
WE ARE LIVE.
Qualified Canadian Readers Only.
Back at it again for another lull week of new issue activity! Fret not, there is no shortage of news to discuss in this week’s Weekly.
In global market news, Coinbase hit the market today with its direct listing of shares. The company closed out its successful first day of trading on the NASDAQ with shares at $328. The listing was priced at $250, and to no surprise, was underpriced. It has been quite some time since I have seen an IPO price with money NOT left on the table. Although, a 31% increase is more palatable than some of its IPO peers.
Galaxy Digital traded down about 17% today, as BTC surpassed US$62,000. The company has been on a phenomenal run over the past 12-months, closing the day at $35.45. Let’s not forget the debacle that followed the horrific RTO pricing led by GMP back in 2018. GLXY shares were priced at approximately $5.00 off the back of a great BTC run - as BTC took a dive, the underwriters refused to reprice. Shares opened at $2.50, and remained below RTO pricing up until late last year. I remember the days when I would hear non-stop complaints of disgruntled RTO participants, from lawyers to bankers. It has been quite some time since I have heard a complaint regarding GLXY, although I have been away from cocktail parties for quite some time now. I’m sure the FOMO is real.
At time of QT, Novogratz owned roughly 11% of ordinary shares outstanding on a fully diluted basis…he currently owns under 1%. I just hope other RTO participants held the bag to-date.
In other news, US-based Roth Capital is continuing its expansion efforts north of the border. Roth is well know in the US for doing what Canadian dealers do best - small-cap financings. The firm is headquartered in Newport California, and seems to be fairly industry agnostic - they will fit in nicely here, with the exception of poorer weather.
Per LinkedIn, Roth currently has a three man operation running, led by former TMX Group Executive, Brady Fletcher. The dealer announced the hiring of Michael Tait this morning, who will head up the firm’s Canadian Origination practice. Michael was perviously a Director and Co-Founder of Waypoint Investment.
Welcome to Canada, Roth. I look forward to keeping you honest.
Air Canada finally inked its latest liquidity package from Mr. Trudeau. The deal is structure similarly to our friends at American Airlines, with bankers likely leaning on Goldman’s precedents:
$1.5B 1L RCF at CDOR + 150, secured by Aeroplan;
$2.5B unsecured CF at CDOR + 175-950;
$1.4B unsecured CF;
15M 10-year warrants; and
$500M in equity, priced at a 14% discount.
The market wasn’t all too pleased, but a much needed lifeline as the lockdown continues.
Lastly, as the RF/CG saga continues, Canaccord Genuity’s Daviau released a statement emphasizing the dealer’s continued interest in RF. Although RF’s board refuses to engage, CG has offered to increase its bid to an unknown figure - a blank cheque, if you will - and is now pursuing legal options. The dealer is motivated to say the least.
ECM World
Top 5 Notable Transactions
Abaxx Technologies
$21.5M bought deal of units (1 sh + ½ wt)
Cormark lead w/ BMO, CG, RJ
Pure Gold Mining
C$15M bought deal of FT
Clarus
Chickapea
C$9.3M best efforts of commons
District Ventures, InvestEco, Export Development Canada
GFL Environment
$594M bought deal of commons
BMO lead w/ RBC, Scotia
Boosh Plant-Based Brands
C$2.5M IPO of commons
Haywood
With Care,
G.G.