CSL placement priced at $273 a share to fund $16.4bn Vifor Pharma deal

The price for CSL’s $6.3bn placement went down to the wire. Picture: Andrew Caballero-Reynolds/AFP

The sheer size of CSL’s $6.3bn placement was always going to mean that selling the equity raising would not be easy.

Being the largest primary raise in Australian corporate history, the thinking was that about $10bn worth of demand would have been needed to achieve a price at the top end of the book build for CSL, even though its shares are sought after due to the quality of the blue chip stock.

Shares were being offered at a range of between $273 and $285, with bids accepted in $2 increments.

The deal priced at the bottom of the range at $273 per share, which was an 8.2 per cent discount to CSL’s closing price of $297.27 on Monday.

The book build closed on Wednesday night after the raise was announced on Tuesday to accompany CSL’s $16.4bn agreed purchase of Vifor Pharma.

The understanding around the market is that some debate existed between the two joint lead managers, Bank of America and Goldman Sachs, on Wednesday as to whether the placement was priced at $273, which was said to be the price that Goldman Sachs was keen on, or $275.

A decision came down to the wire.

Still the raise, which was fully underwritten, got done despite headwinds, which included its size, the time of the year (fund managers typically wind down in the days before Christmas) and the fact that a number of floats that hit the market last month failed to fire, dampening sentiment.

CSL told the market on Thursday that the placement received strong support from existing shareholders and new investors.

Next comes the share purchase plan to secure up to $750m, which opens on December 21.

The $6.3bn placement represents about 5 per cent of the number of CSL shares on issue.