Teva convertibles soar on Allergan bid; Micron, Intel to hold press event; bonds higher

By Stephanie N. Rotondo

Phoenix, July 27 – Teva Pharmaceutical Industries Ltd.’s 0.25% convertible notes due 2026 dominated Monday trading, according to market sources.

The debt was trading higher after it was announced that the company was making a $40.5 billion play for Allergan plc’s generics unit, allowing it to drop its bid for Mylan NV.

Meanwhile, Micron Technology Inc. and Intel Corp. convertibles were busy and better after the two companies announced a joint press conference for Tuesday.

No details were given as to what the event will be about, but speculation is that it could be in regards to a roll-out of new chips the parties recently collaborated on.

Away from those names, a trader said many convertible market players were attempting to figure out “where this [oil and gas] stuff really is.”

“Nobody really knows,” he said.

For its part, benchmark crude oil fell over 2% on the day.

Teva Pharmaceutical’s 0.25% convertible notes popped in active Monday trading after the company announced a $40.5 billion buyout of Allergan’s generic and international business.

The notes rose more than 20 points to 166 bid, 166.5 offered, according to one market source. That was a gain of over 20 points.

The company’s equity jumped $10.15, or 16.41%, to 72.

Teva, an Israeli company, will pay $33.75 billion in cash and $6.75 billion in stock for the asset. The acquisition is expected to increase Teva’s place among generic drug manufacturers.

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