Health care in focus as sector lifts; Softbank mandatory exchangeable into Alibaba on tap

By Rebecca Melvin

New York, May 31 – U.S. convertibles were trading mildly Tuesday on the last day of the month following a long holiday weekend. The health care space commanded attention after news that Jazz Pharmaceuticals plc has agreed to acquire Celator Pharmaceuticals Inc. for $30.25 per share, or about $1.5 billion.

Financial markets were closed on Monday in observance of Memorial Day.

The shares of Celator, a leukemia drug company, which is not a convertibles issuer, were up 70%.

“There is a melt up in health care,” a convertibles trader said, referring to the Celator deal and also an upcoming conference of the American Society of Cancer and Oncology as forces driving some of the attention.

In particular, Array BioPharma Inc. and Ariad Pharmaceuticals Inc., two cancer drug companies, were getting a look and the shares of those companies were up 7% and 8.5%, respectively, the trader said.

Array’s 3% convertibles due 2020 were last at 86.93, according to Trace data.

Jazz Pharmaceuticals’ 1.875% convertibles due 2021 were not trading actively but were last at 112.28, which was down about 0.5 point on an outright basis from a print at 112.8 on Friday.

Meanwhile, after the market close, in primary action, Softbank Group Corp., through a newly formed independent trust incorporated in the United States, launched a $5 billion offering of mandatory securities exchangeable into Alibaba Group Holding Ltd. stock.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.