Morning Commentary: Convertibles secondary market quiet; ON Semiconductor in focus

By Abigail W. Adams

Portland, Me., Oct. 19 – The convertibles secondary space launched the week quietly as equities held steady on continued hope over a stimulus package.

There was $45 million in reported trading volume about one hour into the session with few names seeing concentrated trading activity, a source said.

ON Semiconductor Corp.’s soon-to-mature 1% convertible notes due 2020 were the most actively traded issue early in the session with $5 million in reported volume.

However, the notes were little changed, a source said.

The notes traded at 141.5 early in the session with stock up slightly.

ON’s stock was changing hands at $26.51, an increase of 1.69%, shortly before 11 a.m. ET.

The notes have been active since stock rallied about two weeks ago after activist investor Starboard Value took a stake in the company and rumors swirled about ON Semiconductor being a takeover candidate.

Several analysts raised their price target on the company around the same time, and the rally in stock has had staying power, which has lent credence to the rumors, a source said.

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