At The Market (ATM) Offerings

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At The Market (ATM) Offerings. Presented by, Sara LaFever Sagient Research Systems. Deal Structures YTD * October 31, 2012. ATMs by Year*. Only 1 ATM in 2006 Popularity rose 2009. Exploded in 2010 Continues to expand. *Based on Closing dates. Sector Preference-ATMs. - PowerPoint PPT Presentation

Text of At The Market (ATM) Offerings

Getting into the PIPEline

At The Market (ATM) OfferingsPresented by,Sara LaFeverSagient Research Systems

Sagient ResearchGood morning introSRS/PTThanks to DFMCopy of Preso from boothDeal Structures YTD* October 31, 2012

Sagient ResearchOK, lets move on to structures in the market. A lot of changes this year, all of them positive from an issuers perspective.There was a shift back to traditional structures with common stock deals leading the way.As we highlighted last year, there is an identifiable relationship between a companys cash burn and the quality of structure they can find in the market and a further relationship between the quality of that structure and how the stocks perform in the post-deal period.So, as always, dont wait until the last minute to raise capital (or as my grandfather always told me banks are happy to lend you money when you dont need it).ATMs by Year*Only 1 ATM in 2006Popularity rose 2009*Based on Closing dates

Exploded in 2010Continues to expandSagient ResearchAs a starting point, here is the overview of the market yellow=$, red=deal count.$39.9B raised in 1032 transactions thru 10/15/0737% increase over 2006.Interestingly, no summer slowdown despite seasonality and the market meltdownObviously with higher total $ and lower number of deals, the average deal size has shot up this year.Weve already doubled the 2005 total and at this pace, we will exceed $50B in 2007. Sector Preference-ATMsHealthcare includes Biotech & PharmaEnergy includes Oil & Gas, PipelinesFinancial includes Banks, Closed-end Funds, Diversified Financial Services, Investment Companies

* Data from 2009-presentIndustrial includes Electronics, Transportation, EngineeringOther includes Utilities, Technology, Mining, CommunicationsSagient ResearchSo those are the basic numbers. Whats more interesting to us is to evaluate where the money is actually going.Here we see that there is a big divergence with the money going into the highest and lowest ends of the market.At the high end, you have huge $$ deals with corporate or PE investors.For financial buyers, most of the activity is still happening at the lower ends of the market.We pointed this out last year, but the activity at the absolute smallest part of the market sub-$10M market cap is still going strongAs is the activity with the highest dilution.And so with the PIPE market growing at two different ends and with two different investor groups, structure sets, and investment intents it leads to the question as to whether there are really two PIPE markets emerging?Sector Preference- Non-ATMs*Data from 2009-present

Most ATM issuers are in $100M-$500M range

Issuer Market Cap -ATMsSagient ResearchThis chart shows the breakdown in where money is flowing by market-cap. The yellow bars are the $$ amount and the red line represents the number of transactionsAt the high end you can see that more than $20B has flowed into companies with $1B market-caps in only 42 transactions.At the lowest end the under $50M market-cap issuers, we have 543 transactions totaling about $3.8B.CMPOs vs. ATMsATMs YTD:102CMPOs YTD: 89CMPOs tend to be popular in the healthcare sector*Data from 2009-present

*Data from 2009-presentStats-ATMs vs CMPOs

Average Placement Agent Fees

Average Sum of Gross Proceeds

Average Commitment Amount



N/ARankingPlacement Agent NameDeal Count1.Bank of America Merrill Lynch502.Cantor Fitzgerald & Company473.MLV & Co. LLC384.Wells Fargo Securities, LLC345.Deutsche Bank Securities, Inc. 256.Citigroup Global Markets, Inc. 247.J.P. Morgan Chase & Co. 218.Morgan Stanley209.KeyBanc Capital Markets1910.UBS Securities LLC17Top ATM Placement Agents

*Data from 2009-present