Chefs’ Warehouse edges up; Fluidigm prices $50 million deal; Pinduoduo tanks outright

By Rebecca Melvin

New York, Nov. 20 – Chefs’ Warehouse Inc.’s newly priced 1.875% convertibles traded up by about 0.5 point on both an outright and swap basis on Wednesday after the specialty food products distributor priced $130 million of the five-year paper at the cheap end of coupon talk and the midpoint of initial conversion premium talk.

The notes “opened up with the stock still trading right around the close,” a New York-based market source said.

Also in primary action, Fluidigm Corp. priced an upsized $50 million of five-year convertible senior notes at par to yield 5.25% with an initial conversion premium of 25%, according to a syndicate source.

The deal was initially talked at $45 million in size, and the Rule 144A deal has a $5 million greenshoe.

Barclays priced the deal, which came at the same terms released when the deal was announced early Wednesday.

The Rule 144A deal has a $5 million greenshoe and was being sold via Barclays as bookrunner.

The South San Francisco, Calif.-based maker of integrated microfluidic circuit systems plans to use proceeds of the deal to repurchase about $50 million its existing 2.75% convertibles due 2034.

Back in established issues, Pinduoduo Inc.’s 0% convertible notes due 2024 plunged 15 points on an outright basis to 102. The American Depositary Shares that underly the notes skidded 23% to $31.40 on disappointing earnings.

The Shanghai-based e-commerce platform reported a wider-than-expected third-quarter loss on lower-than-expected revenue that was higher year over year. The net loss attributable to ordinary shareholders widened to RMB 2.34 billion in the quarter ended Sept. 30, from RMB 1.1 billion a year earlier. Revenue rose 123% to RMB 7.51 billion. Operating expenses more than doubled to RMB 8.47 billion on a surge in sales and marketing costs. Excluding items, the company lost RMB 1.44 per ADS. Analysts on average had expected a loss of RMB 0.53 per ADS.

Medicines Co.’s three convertible notes traded off their high marks notched on Tuesday. The notes gapped higher after speculation that several buyers were interested in acquiring the company.

The Medicines 2.5% notes due 2022 pulled back to 205.375 from 210 to 211 on Tuesday, when they had shot up from about 160.

The Medicines 2.75% notes due 2023 traded down to 147 and then back to nearly 150, compared to 149 to 151 on Tuesday, and from around 130 on Monday.

Medicines’ common shares were also off on Wednesday by about 2%, following a 20% surge on Tuesday.

Chefs’ Warehouse edges par

Chefs’ Warehouse’s new 1.875% notes due 2024 opened up about 0.5 point on an outright and hedged basis early Wednesday. But a late trade at 100.663 against a closing share price of $33.37, which was up 1.9% on the day, means the new deal put in a less-than-stellar debut.

The $130 million offering of five-year convertibles, which was announced late Monday, was in line with expectations however. It was looking to be worth just 100.10 at the midpoint of price talk using a credit spread of 425 basis points over Libor and 32% vol., according to a New York-based trader on Tuesday.

Mentioned in this article:

Chefs’ Warehouse Inc. Nasdaq: CHEF

Fluidigm Corp. Nasdaq: FLDM

Medicines Co. Nasdaq: MDCO

Pinduoduo Inc. NYSE: ADS: PDD

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