Morning Commentary: Scorpio Tankers joins Palo Alto Networks, MercadoLibre for pricing Tuesday

By Rebecca Melvin

New York, June 24 – Another new deal launched in the convertibles market early Tuesday, and this one, with same-day pricing, brought the tally of deals set to price after the market close to three.

Monaco-based oil tanker company Scorpio Tankers Inc. launched an offering of $250 million of convertible senior notes due 2019 early Tuesday. The deal was talked with a coupon of 2.125% to 2.625% and an initial conversion premium of 27.5% to 32.5%.

Also pricing after the market close are California network-security company Palo Alto Networks Inc.’s $500 million deal of five-year convertible senior notes and Latin America’s online commerce host MercadoLibre Inc.’s $300 million offering of five-year convertible senior notes.

Both the Palo Alto and MercadoLibre deals were looking good to one market source. “I like the Palo Alto stock story. I like the valuation on MercadoLibre,” he said. No color was yet forthcoming on the Scorpio deal.

Back in established issues, trading was quiet. There was no flurry to sell in the face of about $1.5 billion of new paper set to hit the market in the next few days, sources said.

“I think it’s too early to tell; everyone seems to be milling around the tape,” a New York-based trader said.

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