Highly Structured Deal was First of Its Kind Out of Asia
The Firm represented the underwriters, led by Lehman Brothers and Credit Suisse, in JA Solar Holding’s SEC-registered offering of $400 million aggregate principal of its 4.50% Senior Convertible Notes due 2013. In connection with the convertible note offering, JA Solar entered into a $400 million nominal amount call spread overlay (capped call option transactions) with affiliates of the lead underwriters to hedge its ADS delivery obligations under the convertible notes. In addition, concurrently with the convertible note offering, the issuer lent to affiliates of the lead underwriters 13.1 million ADSs, which were offered pursuant to an effective registration statement, to facilitate hedging by convertible note investors.
The transaction was especially noteworthy for being:
- the first ever SEC-registered convertible note offering with a share lending component by an Asia-based issuer;
- the first ever call spread overlay executed by an Asia-based issuer; and
- the first ever call spread overlay executed by a solar company globally.
JA Solar is an emerging and fast-growing manufacturer of high-performance solar cells in China. Its ADSs are listed on The Nasdaq Global Market under the symbol “JASO”.
The Simpson Thacher team for the transaction included Leiming Chen, Blake Dunlap, Misi Tang, Gao Yi, Wang Yi, Frank Chen (HK Corporate), Roxane Reardon, Joyce Xu, Justin Cooke, Xavier Kowalski, Matthew McBride, Charlene Caprio, Swati Lohia (NY Corporate) and Marcy Geller, Seojung Park (Tax). Paralegals Jane Lee and Enke Xin provided valuable assistance.