Morning Commentary: Vocera, Itron, Avid Bioservices eyed; Everbridge, Eventbrite trade up

By Abigail W. Adams

Portland, Me., March 9 – The convertible primary market continued to churn out new offerings on Tuesday with three deals totaling $725 million set to price after the market close.

Vocera Communications Inc. plans to price $200 million of five-year convertible notes, Itron Inc. plans to price $400 million of five-year convertible notes and Avid Bioservices Inc. plans to price $125 million of five-year exchangeable notes after the market close on Tuesday.

The deals continued to model cheap based on underwriters’ assumptions, sources said.

Meanwhile, new paper from Eventbrite Inc. and Everbridge Inc. made their aftermarket debut on Tuesday on a strong day for equities as the tech sector broke its rout.

The new paper jumped on an outright basis on their aftermarket debuts.

Vocera eyed

Vocera Communications plans to price $200 million of five-year convertible notes after the market close on Tuesday with price talk for a coupon of 0.25% to 0.75% and an initial conversion premium of 32.5% to 37.5%, according to a market source.

The new paper was heard to be in the market with assumptions of 400 basis points over Libor and a 40% vol., according to a market source.

Using those assumptions, the deal looked about 0.78 point cheap at the midpoint of talk, a source said.

Proceeds from the new offering will be used to repurchase a portion of the company’s 1.5% convertible notes due 2023 for cash and shares in privately negotiated transactions.

The 1.5% notes traded as high as 165 in mid-February, according to Trace data.

Itron eyed

Itron plans to price $400 million of five-year convertible notes after the market close on Tuesday with price talk for a fixed coupon of 0% and an initial conversion premium of 35% to 40%, according to a market source.

The deal was heard to be in the market with assumptions of 300 bps over Libor and a 40% vol., according to a market source.

Using those assumptions, the deal looked about 1.33 points cheap at the midpoint of talk.

Concurrent to the convertible notes offering, the company is pricing a secondary offering of $350 million of common shares.

Avid

Avid Bioservices plans to price $125 million of five-year exchangeable notes after the market close on Tuesday with price talk for a coupon of 0.75% to 1.25% and an initial conversion premium of 32.5% to 37.5%, according to a market source.

The notes will be issued by Avid SPV LLC and are exchangeable for Avid Bioservices shares.

The deal was heard to be in the market with assumptions of 500 bps over Libor and a 45% vol., according to a market source.

Using those assumptions, the deal looked 3.24 points cheap at the midpoint of talk.

Eventbrite trades up

Eventbrite priced $185 million of long five-year convertible notes after the market close on Monday at par with a coupon of 0.75% and an initial conversion premium of 30%.

Pricing came at the rich end of initial talk for a coupon of 0.75% to 1.25% and at the midpoint of initial talk for an initial conversion premium of 27.5% to 32.5%, according to a market source.

The new paper jumped on its aftermarket debut.

It was changing hands between 102.5 and 103 on an outright basis early in the session.

Eventbrite stock was changing hands at $22.10, an increase of 3.03%, shortly before 11 a.m. ET.

Everbridge gains

Everbridge priced an upsized $325 million of five-year convertible notes after the market close on Monday at par with a coupon of 0% and an initial conversion premium of 40%.

Pricing came in line with a fixed coupon of 0% and at the midpoint of talk for an initial conversion premium of 37.5% to 42.5%, according to a market source.

The new paper skyrocketed on an outright basis out of the gate.

It traded as high as 105.75 shortly after the opening bell as stock surged more than 5%.

It was changing hands on a 104-handle about one hour into the session.

Everbridge stock traded to a high of $140.90 early in the session. It was changing hands at $135.23, an increase of 4.77%, shortly before 11 a.m. ET.

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