Morning Commentary: Upsized Actavis adds, in line; Tesla Motors’ 1.25% convertibles in mid 80s

By Rebecca Melvin

New York, Feb. 25 – Actavis plc’s upsized $4.6 billion of 5.5% series A mandatory convertible preferred stock was trading up at 102 in the early going Wednesday with the underlying shares up 1%, according to market sources.

The Actavis mandatories, which were a major focus for the market given the deal size, were seen at 102 versus an underlying share price of $292.00, according to a New York-based trader.

Elsewhere, Tesla Motors Inc.’s 1.25% convertibles due 2021 recouped a point to trade at 85.726, according to Trace data, after the bond fell 4 or 5 points on Tuesday from previous levels.

The convertibles of Chesapeake Energy Corp. appeared to be quiet after the Oklahoma City-based energy exploration and development company missed fourth-quarter earnings estimates and its shares sank 11%.

Chesapeake’s 2.5% convertible due 2037 was last at 97, according to Trace data, and its 2.25% convertible due 2038 traded last at 92.75.

Chesapeake shares fell $2.25, or 11%, in the early going Wednesday to $17.63.

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