Morning Commentary: Upsized Proofpoint trades up outright in active trade; Twitter shares up 1%

By Rebecca Melvin

New York, June 12 – Proofpoint Inc.’s new 0.75% convertibles traded up on Friday after the Sunnyvale, Calif.-based internet security-services company priced an upsized $200 million of the five-year senior notes at the rich end of talked terms.

The new Proofpoint 0.75% convertibles were quoted up at 103.5 on an outright basis. Since the market open, they have moved up or down from that level by about 0.125 point, a syndicate source said.

The new bond was outperforming its underlying shares, which were up about 25 cents last at $60.44.

The bonds were trading actively but still all on an outright basis so far. There was no swap demand yet, the source said.

“They traded up, pretty well, with a lot of action both ways,” the source said.

Twitter Inc.’s shares weren’t overly responsive to the company’s announcement late Thursday that chief executive Dick Costolo is stepping down. Shares of the San Francisco-based social-media company were last up a little more than 1%.

The day’s volume in convertibles was mostly the new Proofpoint bonds, sources said. And no levels were heard yet in Twitter’s 0.25% convertibles due 2019 and 1% convertibles due 2021.

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