Morning Commentary: Colfax tangible equity units continue to gain; secondary quiet

By Abigail W. Adams

Portland, Me., Jan. 10 – The convertibles secondary space was quiet early in Thursday’s session as equity markets broke their green streak and opened the day in the red.

Few names saw concentrated trading activity early in Thursday’s session with many on the sidelines evaluating their positions, a market source said.

While the overall market was off to a soft start, Colfax Corp.’s new 5.75% tangible equity units due 2022 remained active and continued to post gains.

The par of $100 units traded as high as 105.25 early in Thursday’s session with common stock on the rise.

Colfax common stock traded up to $21.88, an increase of 3.4%, shortly before 11 a.m. ET.

The units expanded 2 points dollar-neutral on their market debut on Wednesday.

The partial government shutdown, which has ensnared the Securities and Exchange Commission, may be putting a damper on new deal activity, a market source said.

While a different product than a convertible bond, the performance of Colfax’s new tangible equity units was a solid start to the year, a source said.

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