Call Spread or Capped Call Execution
In a call spread or capped call execution, you may be considering your banking advisor as your derivative counterparty. In these executions, it is important to remember that your banking advisor is on the other side of this transaction, and is therefore directly conflicted in providing advice that is in your best interest. Having a dedicated and experienced advisor who sits on YOUR side of the table is incredibly important to ensure that the transaction results in a transparent and fair outcome.
The senior members of J. Wood Capital Advisors are the former call spread execution team at J.P. Morgan, and ranked #1 among derivative counterparties during that time. No other advisor has the direct and relevant expertise associated with call spread or capped call execution, including in the areas of structuring, documentation, economics, accounting, and tax*.
We look forward to sharing our collective experience with you to ensure a successful outcome in your call spread or capped call execution.
STRUCTURING AND DOCUMENTATION
We work closely with management in identifying a Company's objectives to recommend the appropriate call spread or capped call structure. This includes assisting in analysis around strike prices, option premiums, tax impact, and other economic and pricing factors.
Once we have identified a target call spread or capped call structure, we work hand-in-hand with a company's counsel to review call spread or capped call documentation, with a particular focus on avoiding the pitfalls associated with acquisition and repurchase or refinancing situations. Our deep experience in call spread and capped call structuring, negotiation and drafting provides us with a unique and differentiated view into what is achievable with derivative counterparties, which we work hard to translate into benefit for the company.
ECONOMICS
We work closely with the company to design a call spread or capped call bidding process that provides the best economics for the company. Given our unique experience in call spread and capped call execution, we are also able to provide information on potential bank derivative counterparties (including those which may be in a company's bank group) to identify which banks are most competitive in this product.
ACCOUNTING AND TAX
We work closely with a company's accounting and tax team to educate them on the product, and can provide ongoing support as needed throughout the life of the instrument.
