New Microchip flat to higher in gray market, old bonds active; Twitter adds ahead of earnings

By Rebecca Melvin

New York, Feb. 5 – Microchip Technology Inc.’s new and old convertibles were a primary focus of Thursday’s trading session ahead of the pricing of the Chandler, Ariz.-based semiconductor maker’s $1 billion new deal expected after the market close.

The new Microchip convertible, which was talked at a 1.625% to 2.125% coupon and 37.5% to 42.5% premium, was quoted around issue in the gray market and also at par to plus 0.5 point, market sources said.

Microchip’s existing 2.125% convertibles due 2037, which the company plans to redeem with proceeds of the new deal, jumped on an outright basis in active trading. But they looked flat to a little better on a parity basis.

A second, much smaller deal was also in the market, but it wasn’t heard in the gray market. Immunomedics Inc.’s planned $85 million of five-year notes was still on tap for late Thursday, a syndicate source said, despite an 18% slide in the shares of the Morris Plains, N.J.-based biopharmaceutical company.

Elsewhere, Twitter Inc.’s convertibles were up a little ahead of its widely-anticipated quarterly earnings report. After the close, the San Francisco-based social media company posted quarterly earnings that were better than expected and its shares jumped in after-hours action. But monthly active-user growth was lower than expected.

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