Morning Commentary: Weatherford deal pulled, stock pops back; Ares Capital bonds active

By Rebecca Melvin

New York, Sept. 22 – Convertibles players gazed at the ashes of the Weatherford International plc mandatory deal early Tuesday after the company pulled the planned offering of $1 billion of exchangeable subordinated notes and common stock, citing pricing concerns.

The deals were supposed to price late Monday.

But the fact that it was dropped was not that surprising to one New York-based trader “given the stock moved down 17% yesterday.”

In its news release, Weatherford said that investor interest was “strong” but added that it was “unwilling to sell securities at prices that do not reflect the value we have created at Weatherford.”

Stock investors cheered the decision, pulling the stock back up 89 cents, or 10.6%, to $9.30 at late morning.

Elsewhere, a pair of Ares Capital Corp.’s convertibles were trading actively amid no particular news for the New York-based business development company.

Ares Capital’s 5.75% convertible due February 2016 was one of the most active issues of the session, changing hands at just under 101 and down 0.1 point, which matched slightly lower shares. But the stock was paring losses and was last unchanged at $14.88.

Ares Capital’s 5.125% convertibles due in June of 2016 change hands at 101.3, which was down 0.2 point, according to Trace data.

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