Morning Commentary: Travere Therapeutics convertibles offering eyed amid volatile market

By Abigail W. Adams

Portland, Me., March 8 – The convertibles primary market saw some action on Tuesday with one new offering on deck.

Travere Therapeutics Inc. plans to price $250 million of seven-year convertible notes after the market close on Tuesday in a Securities and Exchange Commission-registered offering.

Price talk is for a coupon of 1.75% to 2.25% and an initial conversion premium of 32.5% to 37.5%.

The deal was heard to be in the market with assumptions of 550 basis points over Libor and a 40% vol., according to a market source.

Using those assumptions, the deal looked about 1 point cheap at the midpoint of talk, a source said.

However, the small offering was heard to be wall-crossed.

Proceeds will be used to repurchase for cash a portion of its outstanding 2.5% convertible notes due 2025 in privately negotiated transactions.

There is $276 million outstanding of the 2.5% notes, which the company priced at par in 2018 under its former name Retrophin Inc.

The 2.5% notes were last seen changing hands at 103 in early March, according to Trace data.

The primary market activity comes amid continued volatility in equities with indexes wavering between gains and losses early in the session.

The Dow Jones industrial was up 15 points, or 0.02%, the S&P 500 index was down 0.10%, the Nasdaq Composite was up 0.07% and the Russell 2000 index was up 0.27% shortly before 11 a.m. ET.

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