Secondary trading light; Booking active, Pluralsight up; Caesars Entertainment expands

By Abigail W. Adams

Portland, Me., March 11 – The convertible secondary space was off to a quiet start on Monday with $47 million on the tape early in the session and $293 million on the tape by the late afternoon.

Booking Holdings Inc.’s 0.35% convertible notes due 2020 were the major volume movers on Monday although with little movement in price, sources said.

Fortive Corp.’s 0.875% convertible notes due 2022 also saw high-volume activity.

Pluralsight Inc.’s 0.375% convertible notes due 2024 continued to improve in active trading.

Caesars Entertainment Corp.’s 5% convertible notes due 2024 were also active with the notes making gains on an outright and dollar-neutral basis amid speculation there will be a buyout of the company.

Volume movers

Booking Holdings’ 0.35% convertible notes due 2020 were the major volume movers during an otherwise quiet session on Monday, sources said.

While active, the notes saw little movement in price.

The 0.35% notes were changing hands at 133.375 early in the session. They were seen later in the afternoon changing hands at 132.875 versus an equity price of $1,711.89.

More than $21 million of the bonds were on the tape by the late afternoon.

Booking Holdings stock traded to a low of $1,693.00 and a high of $1,723.00 before closing the day at $1,709.90, a decrease of 0.35%.

Fortive’s recently priced 0.875% convertible notes due 2022 were also major volume movers during Monday’s session.

The notes were changing hands around 104.25.

More than $17 million of the bonds were on the tape late in the session.

Fortive stock traded up to close Monday at $82.18, an increase of 2.21%.

Both Booking and Fortive are large issuances that are rated investment grade. Due to this, the notes tend to trade even on quiet days for the secondary space, a market source said.

Pluralsight gains again

Pluralsight’s recently priced 0.375% convertible notes remained active in the secondary space with the notes continuing to improve.

The notes were changing hands around 101.5 early in the session and 1001.375 later in the afternoon, sources said.

More than $14 million of the bonds were on the tape by the late afternoon.

Pluralsight stock was up about 1% to $29.97 early in the session but came in as the session progressed.

Stock closed the day at $28.87, an increase of 0.21%.

The notes have been active and making gains since they hit the secondary space on March 7.

Caesars expands

Caesars Entertainment’s 5% convertible notes due 2024 made gains on an outright and dollar-neutral basis as stock continued its upward momentum.

The 5% notes were up about 1 point to 141.125 early in the session, a market source said.

They were seen changing hands at 142.625 versus a stock price of $8.67 later in the afternoon.

The notes were improved 0.25 to 0.5 point dollar-neutral, a market source said.

More than $6 million of the bonds traded hands during Monday’s session.

Caesars stock traded to a low of $8.38 and a high of $8.73 before closing the day at $8.67, an increase of 2.6%.

Caesars stock has been on the rise since Friday on news Carl Icahn is now the largest investor in the gaming corporation.

There is speculation Icahn will force the sale of the company, which could either be a positive or a negative for convertible noteholders based on the takeout price, a market source said.

If the takeout price is $12.50, convertible noteholders stand to gain 2.5 points. However, if the takeout price is $11.00, the notes will lose 1 point in value.

Icahn recently purchased 38.9 million shares in Caesars Entertainment at $8.50, raising his stake in the company to 15.5%.

Icahn now has the ability to appoint three members of the board of directors and will have input on the next chief executive officer, Bloomberg reported.

Mentioned in this article:

Booking Holdings Inc. Nasdaq: BKNG

Caesars Entertainment Corp. Nasdaq: CZR

Fortive Corp. NYSE: FTV

Pluralsight Inc. Nasdaq: PS

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