Eksportfinans sells $47 million in securities linked to Claymore YieldStream 20

By Sheri Kasprzak

New York, May 2 - Eksportfinans ASA led structured products news on Wednesday with the announcement of full details on a $47 million issue of 11% enhanced yield securities linked to the 20 stocks of the Claymore YieldStream 20 basket.

The Claymore YieldStream 20 is a basket of stocks selected by Claymore Securities Inc. representing the industrials, information technology, health care, materials, consumer discretionary and energy sectors. It is intended to be "moderately" diversified. Wachovia is the lead agent for the offering.

"I think it has a lot to do with both the stocks involved and the sectors as well," speculated one market source who was not involved with the offering. "I'm seeing some metal and mineral explorers, some tech, some oil. Those are all sectors that have performed well recently so I think that does make a difference."

The basket includes Agnico-Eagle Mines Ltd.; Bea Systems, Inc.; Coldwater Creek Inc.; F5 Networks, Inc.; Freeport-McMoRan Copper & gold Inc.; Intuitive Surgical, Inc.; Joy Global Inc.; Lam Research Corp.; Massey Energy Co.; Monster Worldwide, Inc.; National Oilwell Varco, Inc.; Norfolk Southern Corp.; Nucor Corp.; Nvidia Corp.; Rowan Cos., Inc.; Sepracor Inc.; Sotheby's; and WellCare Health Plans, Inc. The basket also includes the class B stock of Continental Airlines, Inc. and the A stock of Under Armour, Inc.

Securities terms

For each component of the basket that stays above its 75% knock-in level during the life of the securities and finishes at or above its initial share price, the investors will receive $1.00 at maturity. For each stock that drops below the knock-in level during the life of the securities or finishes below the initial level, the investors will receive $1.00 times the performance of that stock.

The securities have a one-year term.

Most stocks gained in April

It is interesting to note that, with a few exceptions - namely Massey Energy, Monster, Nvidia, WellCare and Under Armour, the stocks in the Claymore basket all rose within the month of April and the April 2 stock price for the majority was its lowest level in that period.

Agnico Eagle's stock traded between $35.00 and $38.57 for April and Bea Systems' stock traded between $11.59 and $12.41 but lost $1.28 on May 1 to close at $10.50. During the month of April, Coldwater Creek's stock traded between $20.50 and $22.53, F5's stock between $64.89 and $78.59, and Freeport-McMoRan's stock between $66.73 and $71.34. Intuitive's stock traded between $121.94 and $134.25 for April and Joy Global's stock between $43.27 and $52.18 for the month. Lam's stock ranged between $47.49 and $54.91 in April and Massey between $24.38 and $27.78. Monster's stock traded between $42.05 and $48.51 for the month and National Oilwell between $78.20 and $84.85. Norfolk Southern's stock ranged between $50.57 and $55.73 in April and Nucor's between $64.77 and $67.50. Also in April, Nvidia's stock traded between $28.58 and $33.52. Rowan's stock traded between $33.39 and $37.20 during April and Sepracor between $46.75 and $56.64. Sotheby's stock traded between $45.99 and $52.38 for the month and WellCare between $80.59 and $93.44. Continental's B shares traded between $36.05 and $43.74 and Under Armour's A shares between $49.31 and $53.05.

UBS to price stock basket offering

In another deal linked to a large basket of stocks, UBS AG announced plans to price an offering of call warrants linked to a basket of 15 stocks.

The basket includes the stocks of Aflac Inc.; AMB Property Corp.; Expeditors International of Washington Inc.; FedEx Corp.; The Goldman Sachs Group; Goodrich Corp.; Nike Inc.; Proctor & Gamble Co.; Starbucks Corp.; and United Technologies Corp., as well as the American depositary shares of China Mobile Ltd.; Infosys Technologies Ltd.; Melco PBL Entertainment Macau Ltd.; Nokia Corp.; and Rio Tinto plc.

The shares of Aflac, China Mobile, Melco, Nokia and Stabucks have a 6.66% weight each. The remaining components have a 6.67% weight.

The warrants are expected to expire May 21, 2009 but the exact expiry will be determined at the May 24 pricing.

Investors will receive the notional amount of between $57.95 and $63.49 per warrant multiplied by the return on the basket. The notional amount will equal the issue price of $10.00 per warrant divided by the warrant premium, which will be between 15.75% and 17.25%.

Therefore, investors will lose part of their investment in the warrants if the basket return is positive but less than the warrant premium. If the final basket level is less than or equal to the initial basket level, the warrants will expire worthless and investors will lose their entire investments. Investors may not exercise their warrants prior to the expiration date.

Most stocks climb

Much like the Eksportfinans notes, the stocks linked to the UBS notes all climbed for the most part in April as well.

Shares of Aflac traded between $49.31 and $53.05; shares of Expeditors traded between $41.06 and $43.31; and shares of FedEx traded between $105.44 and $109.03. Goldman traded between $205.65 and $225.60 for April and Goodrich between $51.73 and $56.84. Shares of Nike traded between $53.20 and $54.12 after an April 3 stock split. Starbucks' stock traded between $30.67 and $31.82. United's stock traded between $64.08 and $68.04 and Proctor & Gamble's stock traded between $62.90 and $64.40. China Mobile's ADS's traded between $45.35 and $48.64 for April. In April, InfoSys's stock traded between $49.81 and $55.84 and Melco's ADS's between $16.00 and $19.07. Nokia's ADS's ranged between $22.70 and $25.68 for April and Rio Tinto's ADS's between $230.60 and $255.30.

More of the shares linked to the UBS warrants fluctuated over the course of April than the shares linked to the Eksportfinans offering but all ended higher at the end of April than the beginning.

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