“NSO is committed to a rigorous ethical business framework that relies on the expertise of people with relevant backgrounds to evaluate potential customers and review current customers,” a Novalpina spokesman said in an emailed response to questions. “While use of this technology is on a small highly-targeted scale, it has saved thousands of lives.”
ESG Concerns
Yet European investors have been particularly wary of getting involved in the company given ethical concerns, with some firms not even bothering to examine the pricing, according to lenders who looked at the transaction. Other investors who studied the deal have expressed concern that NSO’s technology is prone to disruption, and participants would be left with few real assets in a recovery scenario.
The tepid response stands in contrast to the success of a debut global bond sale that kicked off Monday from Saudi Arabia’s state-owned oil company, Saudi Aramco. Investors -- who briefly steered clear of anything linked to the Saudi regime last year following Khashoggi’s killing -- had placed orders for about $75 billion, more than five times the expected size of the sale, people familiar with the deal said.
Interest in NSO has been stronger stateside, according to the people with knowledge of that offering, given the company’s already established track record tapping U.S. capital markets.
Chunks of a $250 million loan issued by an NSO entity in 2017 have ended up in collateralized loan obligations managed by firms including Ellington Management Group, MJX Asset Management and Marathon Asset Management, according to data compiled by Bloomberg. CLOs are vehicles that buy hundreds of loans and sell them as bonds to investors based on their risk profiles.
Should the deal ultimately price at 90 cents as anticipated, it will be the steepest discount on a dollar-denominated loan of similar seniority since December 2016, according to data compiled by Bloomberg.
This article provided by Bloomberg News.