Convertibles better as March gets underway; Seacor up; Exelixis expands; SunEdison swamped

By Rebecca Melvin

New York, March 1 – U.S. convertibles were generally better on Tuesday as the market followed an improved high-yield market and rally in equities to start off the new month.

There was trouble with one issuer in particular, however, namely SunEdison Inc., which has become something of a scourge for the convertibles space, and which dropped after the company said it is delaying filing its annual report as an internal investigation into its finances continues.

Overall, convertibles were “much better to buy,” a New York-based trader said, referring to a healthy bid in the market amid a somewhat nebulous offer side.

Energy convertibles were up by about 0.5 point on average, the trader said.

Oil prices surged, ending up about 1.5% on the day, and equity indices saw 2% gains in the S&P 500 stock index and Dow Jones industrial average and a nearly 3% climb in the Nasdaq stock market.

Seacor Holdings Inc. was “in vogue” after the Fort Lauderdale, Fla.-based offshore oil, gas and marine equipment company bought back bonds, a trader said.

Exelixis Inc.’s convertibles popped on an outright basis and improved a couple of points on a swap basis early Tuesday after the South San Francisco, Calif.-based biotechnology company signed an exclusive licensing agreement to commercialize and develop cancer therapy Cabozantinib in regions outside the United States, Canada and Japan, a New York-based trader said.

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