Presentation Transcript

1. Private Placements as a Capital Option

   Northwest Ohio Manufacturing Forum & Expo November 12, 2010
2. Important Disclosures The information contained herein is provided by Prudential Capital Group (“PCG”). This document may contain confidential information and the recipient hereof agrees to maintain the confidentiality of such information. Distribution of this information to any person other than the person to whom it was originally delivered and to such person’s advisers is unauthorized, and any reproduction of these materials, in whole or in part, or the divulgence of any of its contents, without the prior consent of PCG, is prohibited. Certain information in this document has been obtained from sources that PCG believes to be reliable as of the date presented; however, PCG cannot guarantee the accuracy of such information, assure its completeness, or warrant such information will not be changed. The information contained herein is current as of the date of issuance (or such earlier date as referenced herein) and is subject to change without notice. PCG has no obligation to update any or all of such information; nor do we make any express or implied warranties or representations as to its completeness or accuracy. Any information presented regarding the affiliates of PCG is presented purely to facilitate an organizational overview and is not a solicitation on behalf of any affiliate. These materials are not intended as an offer or solicitation with respect to the purchase or sale of any security or other financial instrument or any investment management services. These materials do not constitute investment advice and should not be used as the basis for any investment decision. These materials do not take into account individual client circumstances, objectives or needs. No determination has been made regarding the suitability of any securities, financial instruments or strategies for particular clients or prospects. The information contained herein is provided on the basis and subject to the explanations, caveats and warnings set out in this notice and elsewhere herein. Any discussion of risk management is intended to describe PCG’s efforts to monitor and manage risk but does not imply low risk. These materials do not purport to provide any legal, tax or accounting advice. These materials are not intended for distribution to or use by any person in any jurisdiction where such distribution would be contrary to local law or regulation.
3. Table of Contents Section I Private Placements Section II Prudential Capital Group Section III Products and Services Section IV Contacts
4. Private Placements
5. Private Placement Market Many corporations (both public and private) issue in the private placement market. Reasons include: Desire for long-term, fixed-rate debt Ability to diversify financing sources Outgrow the capacity of existing lenders Wish to maintain availability with revolving facility lenders Private Placements: Unregistered debt or equity financings. The most common form – long-term, fixed-rate debt.
6. Uses for Funding Debt refinancing Expansion and growth capital Acquisition financing Stock repurchases Private Placements are often a source of capital for a company's strategic plans.
7. Selecting a Long-Term Investor Important considerations in choosing a long-term investor include: Relationship orientation, not transaction orientation Capacity to grow as a financial partner Industry knowledge Access to decision makers In addition to price and terms…
8. Prudential Capital Group
9. One of the World's Largest Investors Prudential Financial’s assets under management —$690 billion as of 6/30/10 Investments on behalf of retail and institutional investors Prudential Investment Management manages numerous pension and other institutional funds Prudential Financial is one of the first U.S. insurance companies to structure innovative private transactions and invest in common stocks and leveraged buyouts Prudential Financial, Inc. Insurance Investments International Insurance & Investments Prudential Capital Group
10. World-Class Investor Investing in Relationships:Nearly 1,000 companies around the world rely on us for their long-term capital needs. Our unique regional network of offices enables us to cultivate deep ties in local markets, while enhancing the understanding of client industries. Providing Strategic Capital:Clients look to us for long-term financial solutions that support their business goals. We provide private capital that meets a wide range of financing needs. We help clients diversify their capital sources by serving as a complement to bank and other forms of lending. Delivering Consistent Results:Year after year, we provide private capital through the spectrum of economic and industry cycles. Many of our clients have been with us for 10, 20, even 50 years. Unlike short-term lenders, we take a long-term approach when it comes to capital solutions. Relationships Capital Consistency
11. 2009 Traditional Private Placement Issues Agented vs. Prudential Capital Direct No. of Originations Rank Manager Issues ($B) 1 Prudential Capital Group* 125$6.257 2 BofA Securities 42 $6.772 3 JP Morgan Chase 33 $5.184 4 Royal Bank of Scotland 27 $3.422 5 Barclays Capital 16 $2.591 *Prudential Capital acted as both originator and principal investor on a direct basis. Source of Information: Thomson Reuters – US Private Placement Review – 2010
12. $50.7B Private Placement Portfolio* Utility 13.8% Other 0.8% Basic Industry 4.5% Transportation 5.9% Capital Goods 7.6% Technology 1.6% Communications 3.6% Other Industrial 7.7% Consumer Cyclical 13.3% Financial Institutions 12.5% Consumer Non-Cyclical 21.9% Energy 6.8% *Market value of $50.7 billion as of 6/30/10 Holdings are subject to change
13. Regional Office Network Chicago •Corporate Finance •Pricoa Capital Group •Corporate and Project Workouts •Prudential Capital Partners San Francisco •Corporate Finance •Prudential Capital Partners New York •Corporate Finance •Prudential Capital Partners Newark Corporate and Project Workouts Credit and Capital Markets Institutional Asset Management Lease Finance Group Prudential Capital Partners Los Angeles •Corporate Finance Atlanta Corporate Finance Leveraged Loans Commercial Asset Finance Dallas •Corporate Finance •Global Utility and Energy Finance Electric Finance Group London , Paris and Frankfurt •Pricoa Capital Group
14. Chicago 15 Investment Professionals $15.3 billion invested since 1995 $7.4 billion investment portfolio as of 6/30/10 Financing relationships with nearly 120 regional companies Decentralized, streamlined authority to structure and price new financings and modify terms after closing Chicago: Corporate Finance
15. Products and Services
16. Capital Capabilities Senior, Fixed-Rate Debt Subordinated/Mezzanine Debt Equity Pru-Shelf Note Facility One-Stop Shopping For Capital Structuring Needs.
17. Private Placement Debt Amounts $10 million to $200 million Maturities Up to 20+ years Pricing Methodology Typically fixed rate—U.S. Treasury rate, plus appropriate corporate risk premium Forms Senior debt, subordinated debt and structured finance. Dollar and foreign currency capability Structure Both Secured and Unsecured Amortization Flexible payment schedules
18. Benefits of Dealing with Prudential Capital Group Access to full-range of private capital Ability to fund entire transaction Capacity for multiple financings with an issuer Understand local companies and market conditions Responsiveness and flexibility Regional pricing authority Eliminate agent fees Preserve confidentiality Quick turnaround and streamlined negotiations Shelf facility offers speed and flexibility Seasoned investment professionals Expertise in structuring complex financings Size Regional Presence Direct Capability Experience
19. Contacts
20. Contact Information Kentucky, Michigan, Ohio, Indiana Dianna Carr, Senior Vice President(312) 540-4224 • dianna.carr@prudential.com David Quackenbush, Vice President (312) 540-4228 • david.quackenbush@prudential.com Rebecca Nathan, Associate(312) 565-6228 • rebecca.nathan@prudential.com Kyle Ulep, Associate(312) 565-6279 • kyle.ulep@prudential.com 180 North Stetson Avenue Suite 5600 Chicago, IL 60601 (312) 540-0931