Morning Commentary: PROS Holdings prices new issue at discount; Finisar firms despite results

By Stephanie N. Rotondo

Seattle, June 16 – The convertible bond market got a new issue to bat around on Friday, after PROS Holdings Inc. priced a $106.25 million Rule 144A offering of 2% convertible senior notes due 2047 late Thursday.

The $1,000-par issue came at the discounted price of $880.

The new issue was seen at 90.25 in early Friday trading. The underlying stock (NYSE: PRO), however, was off $1.08, or 3.89%, at $26.71.

The initial conversion rate is 20.5624 shares per each $1,000 of notes, equal to an initial conversion price of $48.63.

The conversion price represents a 75% initial conversion premium over the June 15 closing share price of $27.79.

Proceeds will be used for general corporate purposes, which may include acquisitions or other strategic transactions, working capital and capital expenditures, and possible debt repayment.

Meanwhile, Finisar Corp.’s convertible debt was trading up despite the company providing weak first-quarter guidance.

A market source saw the 0.5% convertible notes due 2033 around 115.75, a gain of about 4.25 points outright. The 0.5% convertible notes due 2036 were pegged at 100.25, up nearly 2.5 points.

Even the company’s stock (Nasdaq: FNSR) was improving, rising 12% in early dealings.

The equity had declined about 6% in after-hours trading on Thursday in the wake of the latest quarterly results.

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