Morning Commentary: DexCom, Electronics for Imaging, Liberty Media sell $1.24 billion

By Abigail W. Adams

Portland, Me., Nov. 28 – After a lull in activity caused by deteriorating market conditions, the convertibles primary market priced $1.235 billion in new paper over three deals.

DexCom Inc. priced $750 million five-year convertible notes, Electronics For Imaging Inc. sold an upsized $135 million of five-year convertibles and Liberty Media Corp. priced $350 million of exchangeable debentures due 2048 prior to the market open on Wednesday.

Each deal priced at the cheap end or cheaper than initial price talk.

The new paper jumpstarted trading activity in the secondary space, which saw more than $205 million on the tape about one hour into the session.

The new paper was holding up well in secondary trading, a market source said.

DexCom at par

DexCom priced $750 million five-year convertible notes prior to the market open on Wednesday at the cheap end of talk with a coupon of 0.75% and an initial conversion premium of 32.5%.

Price talk had been 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 0.75% notes were hovering around par in active trading, a market source said.

They were trading in a range of 99.625 to 100.25 with about $23 million on the tape.

DexCom stock was off slightly early Wednesday. Stock was $122.93, a decrease of 0.85% shortly before 11 a.m. ET.

EFII trades up

Electronics For Imaging priced an upsized $135 million of five-year convertible notes prior to the market open on Wednesday at the cheap end of talk with a coupon of 2.25% and an initial conversion premium of 30%.

Price talk had been for a coupon of 1.75% to 2.25% and an initial conversion premium of 30% to 35%, according to a market source.

The 2.25% notes traded as high as 102 on an outright basis early in the session. However, most trades were between 100.875 and 101.5, a market source said. About $12.5 million was on the tape early in the session.

Electronics For Imaging stock was off slightly early Wednesday. Stock was $27.24, a decrease of 0.8% early in the session.

Liberty Media prices wide

Liberty Media sold $350 million of exchangeable debentures due 2048 prior to the market open on Wednesday with a coupon of 2.25% and an initial exchange premium of 25%.

Pricing came wide of initial talk for a coupon of 1.25% to 1.75% and an initial exchange premium of 27.5% to 32.5%, according to a market source.

The notes are exchangeable into shares of Live Nation Entertainment, Inc.

The 2.25% exchangeables were the most active of the new paper to hit the secondary space on Wednesday.

They were trading in a range of 100.75 and 101.125 with more than $82 million on the tape. Live Nation stock was off slightly early in the session. Stock was $52.74, a decrease of 0.54%, shortly before 11 a.m. ET.

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