Teva mandatories gain with stock on CEO chatter; Cobalt, Weatherford convertibles firm

By Stephanie N. Rotondo

Seattle, July 13 – The mandatory convertible preferred stock space was again being eyed on Thursday, though this time it was due – at least in part – to actual news.

Teva Pharmaceutical Industries Ltd.’s 7% mandatory convertible preferreds due 2018 (OTCBB: TEVVF), for instance, were up $19.00, or 3%, to $594.00.

The issue saw above-average trading for the day.

The company’s stock was also better, adding $1.10, or 3.43%, to close at $33.19.

The gains came as it was reported that Pascal Soriot, chief executive officer of sector peer AstraZeneca, was in the running to take the CEO post at Teva.

Teva has been without a CEO since February. In June, the company also lost its chief financial officer.

For his part, Soriot has done well at AstraZenca, building up its product pipeline and also fending off takeover attempts, including Pfizer’s $118 billion bid.

Meanwhile, Becton Dickinson & Co.’s 6.125% series A mandatory convertible preferreds (NYSE: BDXA) fared well in trading, gaining 4 cents to close at $54.64.

Away from the mandatory market, Cobalt International Energy Inc.’s 3.125% convertible notes due 2021 were seen up about 3 points on the day.

A market source pegged the paper in a 25.375 to 25.625 context.

As for the underlying shares, they were up 22 cents, or 9.61%, to $2.51.

Weatherford International Ltd.’s 5.875% exchangeable senior notes due 2021 were also better, ending the session just south of 103.

The bonds started the day closer to 100.5.

Weatherford’s equity was up 27 cents, or 6.99%, at $4.13.

The upward moves came as domestic crude oil prices firmed 1.34% after the International Energy Agency predicted demand would improve.

If the IEA’s assertions prove correct, that could help stem a global supply cut.

On Wednesday, the U.S. Energy Information Administration reported a larger-than-expected draw from U.S. crude stockpiles.

Crude inventories fell by 7.6 million barrels last week, the EIA said in its weekly report. Analysts had forecast a decline of 2.9 million barrels.

But with U.S. production increasing by 59,000 barrels per day and OPEC reporting that its output rose by 393,000 bpd, the market continued to be skittish about the current oversupply.

Mentioned in this article:

Becton Dickinson & Co. NYSE: BDX

Cobalt International Energy Inc. NYSE: CIE

Teva Pharmaceutical Industries Ltd. NYSE: TEVA

Weatherford International Ltd. NYSE: WFT

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