Discounted NorthStar edges up from issue; Airbus prices; Micron drops, but improves on swap

By Rebecca Melvin

New York, June 26 – NorthStar Realty Finance Corp.’s new 4.625% stock-settlable notes traded a little bit above issue at 99.625 bid, 99.75 offered on Friday after the New York-based commercial real estate investment trust priced $300 million of the 18-month notes at 99.5% of par and beyond the cheap end of talk, a New York-based trader said.

The NorthStar issue, which gives the REIT the option to convert the notes into shares of its European unit pending a spin-off and listing of that unit, is essentially a straight bond that converts into stock at maturity, the trader said.

“It has 0% delta and no equity sensitivity,” he said.

The notes traded somewhat actively at Deutsche Bank Securities Inc., which was bookrunner for the deal, but not actively among other players, a source said.

Also pricing on Friday was a Regulation S deal by Airbus Group SE for €500 million of seven-year, 0% convertible bonds, issued at 102% of par and with a 62.5% initial conversion premium. The deal came at the rich end of talked terms.

In established issues, Micron Technology Inc.’s convertibles traded down on an outright basis, but were up on a dollar-neutral, or hedged, basis with shares of the Boise, Idaho-based chipmaker sharply lower following earnings that missed estimates and a weak outlook.

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