By Abigail W. Adams
Portland, Me., Jan. 12 – New paper from Exact Sciences Corp. and Coupa Software Inc. hit the market Friday after pricing late Thursday with both notes trading up on their debut, according to market sources.
The new paper dominated trading activity and spurred an increase in overall trading volume during Friday’s session. By mid-afternoon, the new paper accounted for $177 million of the total $520 million in trading volume by dollar amount, according to a market source.
Going back a little further among recent deals, Cleveland-Cliffs Inc.’s 1.5% convertible notes due 2025 slipped during active trading Friday after jumping about 8 points on an outright basis Thursday. The notes have made steady gains since they were priced in early December.
Bristow Group Inc.’s 4.5% convertible notes due 2023 continued their upward momentum during Friday’s session. The notes gained another point to trade at their highest level since they were priced in mid-December.
Sempra Energy’s 6% series A mandatory convertible preferred stock due 2021, which priced last week, freed to trade in the open market on Friday under the temporary ticker “SSYYP.”
The mandatory convertible preferred stock, which remained contracted by 0.25 point on a dollar-neutral basis for much of the week, will soon be listed on the New York Stock Exchange under they symbol “SREPrA.”
The preferred stock was at $100.50 as it opened for OTC market business. While the preferred stock is expected to improve as it enters into the open market, outright investors were the major players in the $1.73 billion issuance and many have already staked their claim, according to market sources.
The major question now is where Sempra’s common stock will go. The San Diego-based electricity and natural gas utility and infrastructure company closed on Friday at $106.89, an increase of 0.18%.
New paper
Exact Sciences and Coupa priced a combined $800 million in new paper Thursday night, which dominated trading activity in the secondary market Friday.
With an upsized deal from Exact Sciences and an initial conversion premium priced richer than talk from Coupa Software, the bookbuilding process for both deals must have gone well, a market source said.
Both notes were up in the gray market, a market source said.
Exact upsizes
Shortly after announcing the deal, Exact Sciences priced an upsized $600 million in seven-year convertible notes within talk for an issue price of 98.75, a coupon of 1% and fixed conversion premium of 37%.
Price talk had been for a price of 98.5 to 99, a fixed coupon of 1% and fixed conversion premium of 37%.
Exact Sciences’ 1% notes were at 101.25 bid, 102 offer early in Friday’s session, a market source said. They were trading at 101.5 and 101.875 on an outright basis by mid afternoon, the source said.
Exact Sciences stock experienced heavy trading volume during Friday’s session.
The Madison, Wis.-based molecular diagnostics company’s stock waivered between $52.00 and $53.50 before ending the day at $52.62, a decrease of 4.43%.
The $600 million deal was increased from the initially announced $500 million. Merrill Lynch, Pierce, Fenner & Smith Inc. is the bookrunner for the registered deal, which carries a $90 million greenshoe, increased from $75 million.
Coupa prices rich
Coupa priced $200 million in five-year convertible notes at a coupon of 0.375% and an initial conversion premium of 32.5%.
The deal came at the rich end of talk for a coupon of 0.375% to 0.875% and richer than talk for the initial conversion premium of 25% to 30%, according to a market source.
Coupa’s 0.375% notes were at 101 bid early in Friday’s session, according to a market source. The notes made gains throughout active trading and were up to 102.75 on an outright basis, according to a market source.
The San Mateo, Calif.-based cloud platform for business spend management company’s stock also saw heavy trading volume on Friday. Coupa stock waivered between $33.13 and $34.54 before ending the day at $34, an increase of 1.22%.
In connection with the pricing, Coupa entered into capped call transactions with the initial purchasers of the notes and their counterparties at a strike price of $63.821. The strike price represents a premium from the company’s perspective of 90%, according to a company release.
Morgan Stanley, J.P. Morgan, Goldman Sachs, Barclays and RBC are bookrunners for the Rule 144A deal, which carries a greenshoe of $30 million.
December’s deals
Cleveland-Cliffs 1.5% convertible notes due 2025 slipped during Friday’s session after gaining about 8 points the day before. The notes were trading in the 124 to 125 range on an outright basis after peaking at 126.5 on Thursday, according to Trace data.
The Cleveland, Ohio-based iron ore mining company stock was also down Friday, closing the market at $8.68, a decrease of 1.48%.
The 1.5% notes have made steady gains in the New Year with 126.5 the highest outright trade the notes have seen since they were priced in early December.
Bristow’s 4.5% notes due 2023 reached their highest level during Friday’s session since the notes priced in mid-December. After climbing 4 points Thursday, the notes gained another point to trade at 128.309, according to Trace data.
The Houston, Texas-based global industrial aviation services provider’s stock also increased, ending Friday’s session at $16.58, an increase of 1.84%.
Mentioned in this article:
| Bristow Group Inc.: | NYSE: BRS
|
| Cleveland-Cliffs Inc.: | NYSE: CLF
|
| Coupa Software Inc.: | Nasdaq: COUP
|
| Sempra Energy: | NYSE: SRE
|
| Exact Sciences Corp.: | Nasdaq: EXAS
|
|
|
|
|
© 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.
