Morning Commentary: Dish’s deal does well; Nuance enters market; Intel slips on Mobileye buy

By Stephanie N. Rotondo

Seattle, March 13 – The threat of a blizzard in the Northeast was keeping convertible bond market dealings at bay, a trader said early Monday.

“The trains were empty this morning,” he commented.

New York, along with Boston and other cities located on or near the northeastern coast, is under a blizzard warning as forecasters predicted that up to two feet of snow could get dumped on the region.

The market was also sitting back ahead of the upcoming Federal Open Market Committee meeting. The Federal Reserve committee is expected to announce on Wednesday whether or not interest rates will be increased this month.

Expectations are that a hike is very likely. Still, how much the increase will be remains a question as is whether or not more increases are ahead.

Dish Network Corp.’s new $1 billion of 2.375% convertible notes due 2024 – a deal priced Friday with a 32.5% initial conversion premium – was dominating early trading, according to a trader.

“They are trading a lot,” he said, seeing the issue at 100.25.

As for the underlying stock (Nasdaq: DISH), it was down a nickel at $62.00.

The yield came at the cheap end of the 1.875% to 2.375% talk and in the mid-range of the 30% to 35% conversion premium talk.

Deutsche Bank Securities Inc. ran the books on the Section 4(a)(2) private placement.

Meanwhile, Nuance Communications Inc. added a deal to the pipeline, announcing a $350 million offering of convertible notes due 2025.

However, given that there were many empty desks on Monday due to the looming storm, details were hard to come by early in the session.

Ahead of pricing, the company’s shares (Nasdaq: NUAN) were up 2 cents at $16.93.

Away from new issues, Intel Corp.’s 2.95% convertible notes due 2035 were trading actively and “down with the stock,” a trader said.

He placed the bonds at 133.5, seeing the equity (Nasdaq: INTC) off 80 cents.

Intel was losing ground after it was announced that the company was acquiring Israeli self-driving car technology manufacturer Mobileye for about $15 billion.

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