Convertibles flat as equities tick lower; Pacira, Cypress shares up; TCP Capital to price

By Rebecca Melvin

New York, Aug. 30 – U.S. convertibles were little changed in quiet trading on Tuesday as equities traded off slightly in early action amid a number of economic reports.

“There’s not much of anything going on today, unfortunately,” a New York-based trader said.

Pacira Pharmaceuticals Inc.’s 3.25% convertibles were indicated higher in tandem with a gain in the underlying shares. The convertible bonds gained 6 points to about 174 from 168 previously, and the common shares of Pacira Pharmaceuticals gained $1.59, or 4%, to $41.08.

Meanwhile, the 4.5% convertible bonds of Cypress Semiconductor Corp. were indicated up more than 3 points to about 112, which was up from 108.75 previously, according to a market source. The common shares of Cypress rose 62 cents, or 5.6%, to $11.75.

The Cypress stock was actively traded and among the biggest gainers on the Russell 2000 stock index.

In the primary market, TCP Capital Corp. launched an offering of $100 million of 5.5-year convertible senior unsecured notes after the market close on Tuesday that were expected to price ahead of the market open on Wednesday.

The convertibles of the Santa Monica, Calif.-based specialty finance company were talked to yield 4.5% to 4.75% with an initial conversion premium of 10%, according to market sources.

There is a $15 million greenshoe for the Rule 144A deal, which was being sold via bookrunner Raymond James.

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