New Pattern Energy slips on swap; SanDisk mixed on earnings; Europe brings two new deals

By Rebecca Melvin

New York, July 23 – Pattern Energy Group Inc.’s newly priced 4% convertibles traded a bit higher on an outright basis but slipped on swap in active trade on Thursday after being released for secondary market action.

The San Francisco-based independent power company priced $225 million of the senior notes beyond the cheap end of talk.

The new Pattern convertibles due 2020 were quoted last at about 101 against an underlying share price of $24.25. Shares closed a bit higher, up 94 cents, or nearly 4%, at $24.64, after slumping 8% on Wednesday.

SanDisk Corp.’s convertibles were higher on an outright basis but unchanged to lower on a dollar-neutral, or hedged, basis, a New York trader said after the flash-memory-chip maker reported earnings that were better than analysts’ expectations.

SanDisk’s 0.5% convertibles were unchanged on a swap basis, and the 1.5% convertibles “came in a touch,” the trader said.

Chesapeake Energy Corp.’s convertible bonds and preferred shares “got crushed again” as oil prices fell again and commodities in general slumped.

The Chesapeake 2.25% convertibles extended losses to trade at 79.5 compared to 80 on Wednesday and 88 a month ago.

Internationally, two new deals launched and priced in Europe. J Sainsbury plc priced £250 million of 2.875% perpetual convertible bonds at the cheap end and toward the cheap end of talk, and Beni Stabili SpA priced €200 million of 0.875% 5.5-year convertible bonds that came near the midpoint of talk.

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