High-yield convertibles lower amid illiquidity; Cemex drops; Navistar trades around 44

By Rebecca Melvin

New York, Dec. 14 – High-yield paper was under fire in the convertibles space on Monday with many lower-credit-quality names dropping amid illiquidity, and anything energy-related was bearing the brunt of harsh treatment.

“High yield is getting trashed, and anything energy related is down potentially 5 points,” a New York-based trader said on Monday.

Cemex SAB de CV, which is commodity and emerging-market linked, saw its 3.72% convertibles due 2020 fall to about 73, which was down 3 points on the heels of a 5-point drop on Friday, a New York-based trader said.

Navistar International Corp.’s securities were treading water at about 44 after dropping 15 points on Friday.

But Iconix Brand Group Inc. remained active at pricing that was little changed on Monday as the underlying shares of the New-York-based brand management company dropped.

The Iconix’ 2.5% convertibles due 2016 were seen 91.5 bid, 92.5 offered, which was little changed compared to where they have been trading in recent days.

Iconix shares dropped 51 cents, or 8%, to $6.10 in early trade.

Jarden Corp.’s trio of convertible bonds were trading a little better after news that Newell Rubbermaid has agreed to buy the company for $21 in cash and 0.862 of a share in Newell Rubbermaid for each Jarden share. The price represents a 24% premium to where shares had been trading before word of the deal.

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