Convertibles quiet; Transocean active; Lincare gains; Boston Properties adds; Essex quiet

By Rebecca Melvin

New York, Nov. 30 - The convertible bond market was quiet on Monday, the last day of November and the first day back in the office for many market players after the Thanksgiving holiday.

"Not much of anything really [was] trading out there," a New York-based sellside trader said.

Transocean Inc. was among the more active names. But the oil and gas services company's 1.625% convertibles, or the A tranche, was little changed at 99.25.

Lincare Holdings Inc.'s A paper, or the 2.75% convertibles due 2037, was a name in trade, according to one sellsider, and the issue looked stronger compared to previous levels as its shares wavered and settled little changed in decent volume.

Real estate investment trust Boston Properties Inc. saw its 2.875% convertibles due 2037 in trade at 99, which was up 2.8 points from previous levels, as its underlying shares gained 5%.

News that another REIT, Essex Property Trust Inc., repurchased about $95.4 million of its 3.625% exchangeable senior notes in a privately negotiated transaction failed to generate trades in that name, however.

Sources said the buyback pretty much "wipes out" the issue, which would have about $6 million left outstanding after the repurchase, another New York-based sellsider said.

Although Trace data reported that about $500 million of convertibles traded on the day, sources said that was overstated by about 25% due to trades in one particular issue being over reported.

A security of UBS "has been printing lately and it is always inordinately high to the total volume," a West Coast-based sellside trader said.

Another sellsider said the security trades in odd lots but Trace fails to register the small pieces and prints them as larger than they really are.

Equity markets, which sank on Friday, spent most of the session in negative territory but pushed into the green late in the day.

Early weakness seemed to revolve around Dubai World's newly uncovered debt problems. But word late in the day that Dubai World is in talks with banks to restructure about $26 billion in debt seemed to dispel some worries as the amount was smaller than many expected.

Lincare stronger

Lincare's A paper, or the 2.75% convertibles due 2037, traded at 104 versus a share price of $35.55, according to one sellsider.

That trade compared to levels a month ago on Oct. 20 for the Lincare 2.75% paper at 101 versus a share price of $31.75, which was up from under par previously.

The Clearwater, Fla.-based home deliverer of oxygen and respiratory therapies saw its shares settled little changed on Monday at $35.52, which was up 4 cents on the day in pretty strong volume.

Boston Properties' 2.875% convertibles due 2037 traded at 99, which was up from previous levels as its shares gained 5%.

Shares of the Boston-based office REIT gained $3.19, or 5%, to $66.98 in strong volume.

Essex quiet at 99

Essex's 3.635% convertibles due 2025 weren't seen in trade and were previously at 99, according to Trace data.

The Palo Alto, Calif.-based REIT agreed on Nov. 25 to repurchase about $95.4 million principal amount of those exchangeable senior notes in a privately negotiated transaction, according to an 8-K filing with the Securities and Exchange Commission.

The total amount to be paid is about $94.5 million plus accrued interest.

The transaction is expected to be completed this week.

The majority of Essex's real estate consists of apartment communities.

Mentioned in this article:

Boston Properties Inc. NYSE: BXP

Essex Property Trust Inc. NYSE: ESS

Lincare Holdings Inc. Nasdaq: LNCR

Transocean Inc. NYSE: RIG

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