Morning Commentary: More buyers than sellers for AXA bonds; Nabors convertible preferreds expand

By Abigail W. Adams

Portland, Me., May 11 – The new mandatory convertible paper that hit the secondary market on Thursday continued to perform well early in Friday’s session.

There are still plenty of buyers looking for AXA SA’s 7.25% three-year bonds mandatorily exchangeable for AXA Equitable Holdings, Inc. stock. However, there are few sellers, a market source said.

“We keep seeing buyers, but it’s hard to find,” the source said. “Anyone who’s got it is holding it.”

AXA priced $750 million of the 7.25% bonds after the market close on Wednesday alongside AXA Equitable Holdings’ closely watched IPO. While the IPO missed its target of $3.5 billion, it was still the largest IPO of the year to date, raising about $2.75 billion.

The mandatory exchangeable bonds, which were heavily allocated to outright accounts, were outperforming the equity, a market source said. AXA’s bonds were seen at 104 late Thursday.

AXA Equitable Holdings common stock was up early Friday to $21.10, an increase of 76 cents, or 3.74%.

Nabors Industries Ltd.’s 6% three-year $50-par series A mandatory convertible preferred shares continued their expansion on Friday.

The convertible preferred shares were up 1 point on a dollar-neutral basis, a market source said. They were up another 50 cents on an outright basis to trade at $52.50. Nabors common stock was up 4 cents early Friday to $7.97.

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