Microchip plans $1 billion new deal; Gilead Sciences in focus; Brocade lifts with shares

By Rebecca Melvin

New York, Feb. 4 – Following a pretty uneventful trading session on Wednesday, Microchip Technology Inc. launched an offering of $1 billion of 10-year convertible senior subordinated notes that the Chandler, Ariz.-based semiconductor maker planned to price after the market close on Thursday.

Proceeds of the large, new deal will be used to retire Microchip’s existing 2.125% convertibles due 2037, which traded on Wednesday at about 180.

Elsewhere, Gilead Sciences Inc. was a focus among convertibles traders after the Foster City, Calif.-based biopharmaceutical giant posted earnings that sent its shares lower by 8%.

Gilead’s 1.625% convertibles due 2016 fell about 30 points on an outright basis – but were still well above quadruple par – at about 430. That pricing was said to be at around parity or parity minus a point, market sources said.

Brocade Communications Systems Inc. saw some demand for its 1.375% convertible due 2020, which priced last month. The Brocade convertibles were up a bit at 104.875 bid, 105.125 offered with the underlying shares at $11.78, a New York-based sellsider said.

Even as oil prices dropped back sharply from a four-day rally, there wasn’t much activity in the energy space, a New York-based trader said.

West Texas intermediate crude oil for March delivery fell $4.45, or 8.4% to $48.60 per barrel. Brent crude oil fell 6.5% to $54.16 per barrel.

© 2015 Prospect News.
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