Convertibles primary prices $1.2 billion in four deals; BridgeBio, NanoString soar

By Abigail W. Adams

Portland, Me., March 5 – The convertibles primary market rolled out $1.2 billion in four new deals after the market close on Wednesday.

The new paper from BridgeBio Pharma Inc., NanoString Technologies Inc., Enphase Energy Inc. and Infinera Corp. hit the secondary space as equities again plummeted on coronavirus concerns.

Despite the overall weakness in equities, BridgeBio’s and NanoString’s convertible notes were making large gains on an outright and dollar-neutral basis.

Enphase Energy’s new convertible notes were also performing well.

However, new paper from Infinera was coming in on an outright and dollar-neutral basis as stock continued to get “annihilated” during Thursday’s session.

BridgeBio expands

BridgeBio Pharma priced an upsized $475 million of seven-year convertible notes after the market close on Wednesday at par with a coupon of 2.5% and an initial conversion premium of 37.5%.

Pricing came at the midpoint of talk for a coupon of 2.25% to 2.75% and an initial conversion premium of 35% to 40%, according to a market source.

The greenshoe was also upsized to $75 million.

The initial size of the deal was $350 million with a greenshoe of $52.5 million.

The new paper was making large gains on both an outright and dollar-neutral basis.

“It’s nice to see a coupon for a change,” a source said.

The 2.5% notes were changing hands at 102.75 with stock off slightly early in the session, a market source said.

They continued to trade on a 102 handle throughout the afternoon.

The notes expanded about 2.5 points dollar-neutral, a market source said.

There was sizable demand for the notes during bookbuilding and in the aftermarket, source said.

BridgeBio stock traded to a high of $31.18 and a low of $29.53 before closing the day at $29.99, a decrease of 3.44%.

NanoString in demand

NanoString Technologies priced an upsized $200 million of five-year convertible notes after the market close on Wednesday at par with a coupon of 2.625% and an initial conversion premium of 40%.

Pricing came at the midpoint of talk for a coupon of 2.375% to 2.875% and an initial conversion premium of 37.5% to 42.5%, according to a market source.

The greenshoe was also upsized to $30 million.

The initial size of the deal was $175 million with a greenshoe of $26.25 million.

The deal also came with a nice coupon, a source said.

The 2.625% notes were also making large gains on an outright and dollar-neutral basis.

The notes were changing hands around 102.75 with stock off early in the session, according to a market source.

They traded up to 103.125 by the mid-afternoon.

The notes expanded about 3 points dollar-neutral, a market source said.

NanoString Technologies stock traded to a high of $34.60 and a low of $33.61 before closing the day at $34.45, an increase of 0.88%.

Enphase Energy trades up

Enphase Energy sold $320 million of five-year convertible notes after the market close on Wednesday at par at the midpoint of talk with a coupon of 0.25% and an initial conversion premium of 52.5%.

Price talk was for a coupon of 0% to 0.5% and an initial conversion premium 50% to 55%, according to a market source.

The new paper was performing well in active trading.

The 0.25% notes were seen changing hands at 100.75 with stock down early in Thursday’s session.

Enphase Energy stock rebounded as the session progressed. Stock traded to a low of $51.77 and a high of $59.00 before closing the day at $56.69, an increase of 6.02%.

Infinera below par

Infinera sold $200 million of seven-year convertible notes after the market close on Wednesday at par with a coupon of 2.5% and an initial conversion premium of 30%.

Pricing came at the cheap end of talk for a coupon of 2% to 2.5% and at the midpoint of talk for an initial conversion premium of 27.5% to 32.5%, according to a market source.

The 2.5% notes sank well below par as stock “got annihilated” on Thursday, a market source said.

“It’s crazy how low they traded right off the bat,” another source said.

The 2.5% notes traded as low as 96.875 early in the session with most prints between 97 and 98, a source said.

However, the notes saw a slight rebound as stock bounced off its lows heading into the afternoon.

The notes traded up to 99 shortly before the market close.

They were contracted about 0.25 point dollar-neutral.

Infinera stock traded to a high of $5.75 and a low of $5.45 before closing the day at $5.50, a decrease of 6.62%.

Stock was down more than 22% over the past week, a source said.

Mentioned in this article:

BridgeBio Pharma Inc. Nasdaq: BBIO

Enphase Energy Inc. Nasdaq: ENPH

Infinera Corp. Nasdaq: INFN

NanoString Technologies Inc. Nasdaq: NSTG

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