Health care names better bid; Brocade extends dollar-neutral gain; Aegean Marine rises

By Rebecca Melvin

New York, Jan. 13 – U.S. convertibles were riding higher early Tuesday amid a rally in equity markets, and they went quiet around midsession as equities whipsawed to the downside and closed lower, a New York-based trader said.

“There was a pretty big buy wave this morning, but it shut off at about 12:30 p.m. ET,” the trader said.

Of paper in demand in the early going were many health care names, including BioMarin Pharmaceutical Inc.’s 0.75% A series and 1.5% B series convertibles in follow through action from Monday when shares of the Novato, Calif.-based biopharmaceutical company jumped following a presentation at the J.P. Morgan Healthcare Conference underway this week in San Francisco.

Elsewhere, Brocade Communications Systems Inc.’s 1.375% convertibles, which debuted in the secondary market on Friday, extended gains again, riding up another 0.5 point in early action for a cumulative dollar-neutral gain of 4 points since the issue priced.

The new bond was seen at 104.25 versus where shares of the San Jose, Calif.-based storage area networking company closed at $11.95, a syndicate source said.

Aegean Marine Petroleum Network Inc.’s convertibles were up from the offer price of its $42 million add-on Tuesday, trading at 113.75 bid, 114.75 offered versus an underlying share price of $13.25, after the Athens-based marine fuel logistics company priced the additional 4% senior notes due 2018 at 111, according to a syndicate source.

Aegean Marine shares were off 9% at $13.25.

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