Morning Commentary: American Realty bonds up with shares lower; market quiet ahead of holiday

By Rebecca Melvin

New York, Dec. 24 – American Realty Capital Properties Inc.’s 3% convertibles changed hands a point higher on Wednesday despite lower shares after the New York-based real estate investment company provided a business update including news that it has received a waiver from lenders, which reduces its maximum credit facility debt.

The American Realty 3% convertibles due 2018 traded at 89.125, which was up a point, a New York-based trader said.

Shares of the REIT were down 3.7% to $8.02.

The company said that under a new agreement with lenders its maximum debt under its current credit facility is reduced to $3.6 billion. It also said that it has received an extension for reporting third- and fourth-quarter results in light of recent accounting irregularities.

The company has also agreed not to pay a dividend to shareholders until it can report quarterly results. It plans to pay a dividend that is in line with peers.

Otherwise U.S. convertibles were quiet Wednesday with ranks of market players thinned ahead of the Christmas holiday. Those at their desks mostly watched stocks and did housekeeping.

The financial markets close early Wednesday at 1 p.m. ET ahead of Christmas Eve and remain closed on Thursday for Christmas Day.

Even though markets will reopen on Friday, for many market players the year is done, with little to no activity expected in either the primary or secondary convertibles markets before the New Year.

“There’s absolutely zero,” a New York-based trader said about market action Wednesday morning.

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