Macquarie extends gains; Citrix, MGIC, Radian up on swap; Energy & Exploration improves

By Rebecca Melvin

New York, July 11 – Macquarie Infrastructure Co. LLC’s new 2.875% convertibles extended gains on Friday after putting in a strong debut on Thursday as convertibles players continued to chase investment-grade paper, market players said.

In addition, several U.S. convertibles in focus on Friday were lower on an outright basis but better on a dollar-neutral, or hedged, basis. Among those names, Citrix Systems Inc. edged up 0.125 point on swap, and mortgage insurers MGIC Investment Corp. and Radian Group Inc. were 0.25 point better on swap as shares slumped over proposed liquidity rules for mortgage insurers.

Tesla Motors Inc.’s convertibles traded actively with mixed pricing. There were sellers in the Tesla A convertibles, which contracted by about 0.125 point on swap, and buyers in the Tesla B convertibles, which gained between 0.125 point and 0.25 point, a New York-based trader said. Tesla shares were down about 5% on the week.

In the primary market, Energy & Exploration Partners Inc.’s pre-IPO convertibles priced with an 8% coupon, and those notes were seen in trade at 100.25 bid, 101 offered after the company priced $375 million of the five-year convertible subordinated notes under Rule 144A.

“Other than that, there was not a ton,” one New York-based trader said. And quiet trading was the trend on other convertibles desks as well as stocks meandered for much of the session before closing higher and as credit was flat.

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