SunEdison gaps lower again; new Black Hills mandatory looks cheap; Clovis slide continues

By Rebecca Melvin

New York, Nov. 17 – Outsized losses in SunEdison Inc. continued to mount on Tuesday, hitting the convertibles market hard. The SunEdison D tranche fell to about 36 from 40 on Monday and down from about 46 last week when the St. Peters, Mo.-based solar technology company released third-quarter results that gave investors another look into troubling financials.

The SunEdison 2% convertibles that mature in 2018 fell to 47 on Tuesday from about 56 on Monday and down 42% from the end of October, when the bond was at 81.

SunEdison shares plunged again, dropping another $1.50 to about $3.05 as energy prices came off and amid headlines regarding sales of SunEdison stock by hedge funds and after Vivint Solar Inc., the company it plans to acquire, reported disappointing results.

Clovis Oncology Inc.’s convertibles extended losses after plunging by about 100 points on Monday. The Boulder, Colo.-based biotechnology company had announced that regulators have asked for more clinical data on its rociletinib lung cancer treatment.

The Clovis 2.5% convertibles due 2021 fell to about 78 early Tuesday, which was down from 80 or 81 on Monday and down from 180 on Friday.

Clovis shares were down another $3.41, or 11% to $26.83, after crashing 70% on Monday.

In the primary market, Black Hills Corp.’s planned $260 million mandatory convertible, which was slated to price after the market close, looked to be about 2% cheap at the midpoint of talk, a Connecticut-based sellsider said.

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