Morning Commentary: Algonquin Power equity units hit the aftermarket, open flat

By Abigail W. Adams

Portland, Me., June 18 – The last and largest convertible bond deal of the week hit the aftermarket on Friday.

Algonquin Power & Utilities Corp. priced an upsized $1 billion three-year par-of-$50 equity units after the market close on Thursday at the midpoint of talk with a yield of 7.75% and an initial conversion premium of 20%, according to a company news release.

Price talk was for a yield of 7.375% to 7.875% and a threshold appreciation premium of 17.5% to 22.5%, according to a market source.

The greenshoe was also upsized to $150 million.

The initial size of the offering was $900 million with a greenshoe of $135 million.

The equity units fell flat in the aftermarket. They were stuck at $50 with stock flat early in the session.

Algonquin’s stock was changing hands at $14.98 shortly before 11 a.m. ET.

Outside of new paper from Algonquin, the secondary space was quiet early Friday.

There was $86 million in reported volume a little over one hour into the session with few names seeing concentrated trading activity.

Pioneer Natural Resources Co.’s 0.25% convertible notes due 2025 was the most active convertible bond.

The 0.25% notes were changing hands at 145.75 versus a stock price of $154.77, according to a market source.

There was more than $8 million in reported volume.

Pioneer’s stock was trading at $156.27, a decrease of 0.83%, shortly before 11 a.m. ET.

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