Anacor rises amid speculation it’s a target; other health care names better to buy

By Rebecca Melvin

New York, April 6 – Health care names notched gains on Wednesday after the $160 billion merger between Pfizer Inc. and Allergan plc was scrapped on Tuesday, and some energy convertibles were also higher amid a rise in crude oil prices.

Anacor Pharmaceuticals Inc.’s 2% convertibles extended gains for a fourth straight day since that issue’s debut on Friday, as investors pushed this and other health care securities higher in expectation that they might benefit from the cancelled Pfizer-Allergan merger.

The convertibles of Ironwood Pharmaceuticals Inc. also gained as it is viewed as another potential target in lieu of the Pfizer deal.

Health care convertibles were generally better on Wednesday. “There are better buyers across the board with people thinking there is a bounce here,” a New York-based sellsider said.

Among energy names Whiting Petroleum Corp. was higher as the price of oil for May delivery settled up $1.86, or 5%, to $37.75 a barrel.

The rise in oil prices was sparked by an unexpected drawdown in stockpiles as reported by the Energy Information Administration.

Elsewhere, Iconix Brand Group Inc.’s 2.5% convertibles traded unchanged at 99.95 bid, 100 offered, a New York-based trader noted.

The convertible primary market was quiet again on Wednesday. No new deals have priced this week.

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