Morning Commentary: Planned Ironwood pricing looks good; Avid also in the market; Newmont trades

By Rebecca Melvin

New York, June 8 – Convertibles players were sizing up two new deals in the market early Tuesday that were set to price after the market close.

Ironwood Pharmaceuticals Inc.’s planned $300 million deal of seven-year convertible senior notes looked like it was priced appropriately, one trader said, and it should do well.

But valuation inputs were contingent on such questions as how much of the company’s secured debt would be paid down with proceeds of the new deal, the trader said.

Ironwood is a Cambridge, Mass.-based pharmaceutical company. Its shares fell 7% on the heels of the convertible deal announcement.

Also in the market, Avid Technology, a Burlington, Mass.-based digital media company, planned to price $115 million of five-year convertibles.

Back in established issues, Newmont Mining Corp.’s 1.625% convertibles were trading actively following news that the Denver-based mining company has agreed to purchase a Colorado mine from AngloGold Ashanti Ltd. for $820 million. Newmont is issuing 29 million shares of common stock in a public offering to help pay for the mine.

Newmont’s convertibles changed hands down 0.8 point at 103.5, according to Trace data. Newmont shares were down about 1.5%.

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