Upcoming holiday weighs on liquidity in convertibles market; Intel active; Onyx rises

By Stephanie N. Rotondo

Phoenix, July 1 - The third quarter's start combined with a shortened holiday week made for light trading in the convertible bond market on Monday.

"Some people are on vacation already or they are just sitting, watching, waiting for more definitive moves on interest rates," one market source said. He noted that employment numbers come out on Friday, which might also be keeping investors sidelined.

Intel Corp. was the busiest name of the day, though on no fresh news. However, Onyx Pharmaceuticals Inc. paper was also busy following news it had rejected an unsolicited takeover bid from Amgen Inc.

Intel gets busy

Intel's 2.9% convertible notes due 2035 were the "most active" securities of the day, a trader said, though he was "not sure why."

The notes traded at 108.5 versus a share price of $24.00, the trader said.

That was in line with where the bonds had gone out on Friday.

The stock price was $23.89 at the close, down 34 cents, or 1.42%, from Friday's close.

Intel is a Santa Clara, Calif.-based designer, manufacturer and seller of digital technology platforms.

Onyx nixes takeover deal

Onyx Pharmaceuticals jumped over 100 points on Monday following news out on Sunday regarding an unsolicited takeover bid from Amgen.

A trader pegged the 4% convertible notes due 2016 at 337 versus a share price of $131.33.

The stock was up $44.51, or 51.27%, at $131.33 in well above-average trading.

On Sunday, the San Francisco-based biopharmaceutical company confirmed that it had received a $120-per-share offer from Amgen. However, the company's board rejected the proposal, stating that it was "not in the best interest of Onyx or its shareholders."

But Amgen's unprovoked offer and interest from other parties resulted in the company hiring Centerview Partners LLC as financial adviser and Goodwin Procter LLP as legal adviser to look into other potential merger options.

One analyst indicated that the price could be valued as high as $180 per share.

Healthways plans private sale

Healthways Inc. said Monday it would price a private placement of at least $100 million cash convertible senior notes due 2018.

The company's stock fell $1.16, or 6.67%, to $16.22 on the news.

Interest on the notes will be payable semiannually.

Proceeds from the sale will be used to pay the costs of the hedge transactions and to reduce outstanding debt. Any remaining funds will be used for general corporate purposes, including acquisitions, strategic partnerships and expansion strategies.

Healthways is a Nashville-based provider of well-being improvement solutions.

Mentioned in this article:

Intel Corp. Nasdaq: INTC

Onyx Pharmaceuticals Inc. Nasdaq: ONXX

Healthways Inc. Nasdaq: HWAY

© 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.