Morning Commentary: Depomed remains on radar; NXP notes still active; NQ Mobile settles placement

By Stephanie N. Rotondo

Seattle, Oct. 4 – It was “all the same names” trading in the early convertible bond market, according to one trader.

The trader also noted that the Rosh Hashana holiday continued to weigh on overall volume, though liquidity was moderately better than Monday.

Depomed Inc. continued to be actively traded. After gaining ground in the previous session, the 2.5% convertible senior notes due 2021 were holding steady at 145.25 against a stock price of $25.37, a trader reported.

The name was getting attention on Monday after it was reported Friday that the drugmaker had won a patent lawsuit on its opioid drug, Nucynta. The win could help the company seek a buyer.

There also continued to be some action in NXP Semiconductors NV’s 1% convertible senior notes due 2019.

A trader pegged the issue at 120.125 versus a share price of $103.88.

On Thursday, it was announced that Qualcomm Inc. was in talks to acquire the Eindhoven, Netherlands-based chipmaker in a deal valued at over $30 billion.

Meanwhile, NQ Mobile Inc. said it has closed its $220 million Regulation S offering of 8% convertible notes due 2018.

That issue was sold in its entirety to Zhongzhi Hi-Tech Overseas Investment Ltd.

The deal priced Sept. 27 with a 51.5% initial conversion premium.

Proceeds from the deal are expected to be used to pay off the existing 4% convertible senior notes due 2018. That paper becomes putable on Oct. 15, then provisionally callable on Oct. 20, with a 130% price hurdle.

A trader said the 4% convertibles had a 98.75 bid in early Tuesday trading.

The stock (NYSE: NQ) was trading at $3.85 early in the session. That was a significant discount to the conversion price of $25.61.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.