WASHINGTON, D.C., November 26 -- The International Finance Corporation (IFC) launched its fifth warrant issue on November 20, 1996 offering 1.25 million S&P 500 Index-linked put warrants with a 3-month Reset expiring November 20, 1997. The warrants have been approved for listing on the Chicago Board Options Exchange, Inc. (the “CBOE”) and the New York Stock Exchange, Inc. (the “NYSE”) under the symbol “OPT.WS.”
Each warrant was offered at US$3.84 and has a face value of US$50. It can be exercised immediately upon issue and carries a strike price of 743.95 which will be reset to a higher index number on February 20, 1997 if the S&P Index is higher on that date.
“The warrants will increase in value as the S&P Index level decreases,” said Robert Graffam, Director of IFC’s Treasury, Syndications and Financial Policy Department. “They are expected to appeal to investors who take a bearish view on future movements in the underlying index. The reset feature of the warrant is an interesting nuance added to the issue since it offers investors a measure of protection against a temporary rise in the level of the S&P 500 Index. This is the first warrant of its kind to be offered in the United States, and the markets, especially those investors who believe that equities are overheated, have responded positively.”
The warrants have been underwritten by Oppenheimer & Co., Inc. and EVEREN Securities, Inc.
IFC is a member of the World Bank Group and the largest multilateral source of financing for private sector companies in developing countries. Its long-term debt is rated triple-A by Standard & Poor’s and Moody’s Investors Service.
