Invacare bond drops below par as shares slip; Vodafone launches £2.9 billion mandatories

By Rebecca Melvin

New York, Feb. 18 – Invacare Corp.’s new 5% convertibles initially traded “OK” on Thursday after the bonds were released for secondary market action following pricing of the $130 million of five-year senior notes. But pricing faded with the underlying shares later in the session.

The Invacare 5% convertibles were last seen at 98 after earlier trades at 100.5 to 101, market sources said. Invacare shares also weakened on the session, closing down 44 cents, or 3.4%, to $12.37. Earlier the shares were only fractionally lower. On the heels of the deal launch, the shares dropped 24% on Wednesday.

Also in primary action, London-based Vodafone Group plc launched an offering of £2.9 billion of mandatory convertible bonds that were expected to price next week. The Vodafone deal is coming in tranches of 18-month and three-year maturities.

The coupon on the shorter-dated Vodafone tranche was talked at 1.2% to 1.5%, and the coupon on the longer-dated tranche was talked at 1.7% to 2%. The premium will be based on a conversion price that is approximately the spot price for the shares of the London-based telecommunications company.

Back in the U.S. secondary market, convertibles were mostly mixed in mild trading. Volume was about average, an East Coast-based buysider said shortly before midday.

Nvidia Corp.’s 1% convertibles due 2018 jumped on an outright basis along with shares of the graphics chip maker after the company reported better-than-expected quarterly results and guided current-quarter revenue above estimates.

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