When: Today, Tuesday, January 25, 2011
Where: CNBC's "Fast Money" AT 5PM ET
Following is the unofficial transcript of breaking news from CNBC's Kate Kelly. All references must be sourced to CNBC.
MELISSA LEE: I GOT TO BREAK IN. WE HAVE SOME BREAKING NEWS. WANT TO GO TO KATE KELLY. SHE'S GOT THE LATEST ON THE NIELSEN IPO. KATE.
KATE KELLY: MELISSA, I UNDERSTAND THAT THE UNDERWRITERS AND COMPANY ARE ON A CALL AS WE SPEAK, AND THEY HAVE DECIDED TO PRICE THIS DEAL AT $23. THAT'S ACTUALLY A BUCK ABOVE THE INTENDED RANGE OF 20 TO 22. THEY DID NOT HAVE THE TO REFILE IN ADVANCE WITH AN INTENTION TO GO TO 23, BECAUSE THE OVERALL DEAL SIZE WITH THE SIZE OF THE SHARES BEING SOLD AND THE PRICE ISN'T ENORMOUSLY DIFFERENT THAN INTENDED. BUT THIS MEANS, MELISSA, THAT THE VERY FIRST MAJOR IPO OF THE YEAR, THE FIRST LARGEST SPONSOR LED DEAL IN NEARLY FOUR YEARS IS GOING TO RAISE ABOUT $2.2 BILLION DOLLARS. THATS IF YOU ASSUME THE GREEN SHOE IS EXERCISED AND YOU ALSO ADD IN THE MANDATORY CONVERTIBLE SUBORDINATED BONDS THEY'RE SELLING, WHICH ARE GOING TO RAISE A TOTAL OF JUST SHY OF 300 MILLION. BUT 2.2 BILLION OVERALL. NOT A BAD SHOWING AT ALL. I UNDERSTAND THEY WERE OVERSUBSCRIBED AND THATS WHY THEY WERE ABLE TO MOVE THE PRICE HIGHER. BUT OF COURSE, AS WITH ANYTHING, THEY WAITED ALL DAY TO SEE WHAT THE MARKET CONDITIONS WOULD PROVIDE AND THEY ALSO WANT TO MAKE SURE THE TRADING GOES WELL NOT LEAST BECAUSE THEIR SPONSORS PROBABLY WANT TO BE ABLE TO SELL THEIR POSITIONS IN THE COMING MONTHS AND YEARS. AND THEY WANT THE MARKET TO BE RECEPTIVE TO IT.
LEE: KATE, WHAT DOES THIS MEAN FOR VALUATIONS FOR OTHER SORT OF RELATED MEDIA TYPE COMPANIES OUT THERE? BECAUSE THAT'S ALWAYS WHAT PEOPLE LOOK TO IPOs FOR. WHAT IS THE DEMAND IN THE MARKET? WHAT IS THE MARKET WILLING TO PAY FOR THESE COMPANIES? WHAT SORTS OF VALUATIONS MIGHT WE THEN BE ABLE TO APPLY TO OTHER SIMILAR COMPANIES OR COMPANIES IN THE SAME INDUSTRY?
KELLY: I THINK THAT'S A GREAT QUESTION, AND I THINK TO A LARGE DEGREE NIELSEN IS RIDING OFF ON SOME POSITIVE MARKET SENTIMENT. I KNOW WE DIDNT MAKE IT TO THE TWELVE THOUSAND MARK FOR GOOD TODAY.BUT OBVIOUSLY, THERE'S A LOT OF POSITIVE MENTALITY OUT THERE, SO I THINK THAT HELPED LIFT THE NIELSEN DEAL AND PROBABLY WILL LIFT MEDIA STOCKS AS WELL. ON THE OTHER HAND ONE ASPECT IN THE NIELSEN STORY THATS BEEN WORKING TO THEIR ADVANTAGE IS THERE ARE NOT A LOT OF PURE PLAY COMPETITORS.THERE ARE COMPETITORS THAT COMPETE WITH PARTS OF THEIR BUSINESS WHETHER IT'S COMSCORE, TIVO, DISH AND A NUMBER OF OTHERS. BUT NOBODY DOES EXACTLY THE SAME THING IN TERMS OF TRACKING CONSUMER BEHAVIOR ON THE RETAIL SIDE, EVERYTHING FROM CARS TO COCA-COLA AND THEN OF COURSE THE RATINGS THAT WE'RE FAMILIAR WITH ON TELEVISION AND IN OTHER MEDIA OUTLETS WHICH IS ABOUT A THIRD OF THEIR BUSINESS. WHEREAS THE OTHER SEGMENT IS TWO THIRDS. SO I DON'T THINK THERE'S A DIRECT COROLLARY RIGHT NOW BUT I DO THINK THIS IS GENERALLY POSITIVE FOR THAT SECTOR.
LEE: ALRIGHT KATE, THANKS SO MUCH FOR THAT UPDATE. AGAIN, NIELSEN, THE IPO PRICING ABOVE THE EXPECTED RANGE, 23 DOLLARS A SHARE RAISING POTENTIALLY 2.2 BILLION DOLLARS. AND AS KATE HAD MENTIONED A VERY GOOD POINT VERY GOOD FOR MARKET SENTIMENT HERE.
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