Midday Commentary: ServiceNow prices at tight end, edges up on debut; Seacor, InvenSense also price

By Rebecca Melvin

New York, Nov. 7 - ServiceNow Inc.'s newly priced 0% convertibles edged up in early action Thursday after the San Diego, Calif.-based cloud-based IT services company priced $500 million of the five-year paper at the tight end of talked terms late Wednesday.

The ServiceNow 0% convertible was seen at 101.5 bid, 102 offered, with a trade at 101.625 versus a share price of $53.73, which was Wednesday's close, according to market sources.

The bonds have an initial conversion premium of 37.5%, and in connection with the offering, ServiceNow entered into convertible note hedge and warrant transactions with one or more of the initial purchasers of the notes, which boosts the effective initial conversion premium of the bonds from the issuer's perspective to 100%.

Proceeds are earmarked for general corporate purposes, including potential acquisitions and strategic transactions, and to pay the cost of the convertible note hedge transactions.

Seacor Holdings Inc. and InvenSense Inc. also priced deals late Wednesday at the tight end and beyond the tight end of talked terms. But only InvenSense saw an upsizing.

Seacor priced $200 million of 15-year convertible senior notes to yield 3% with an initial conversion premium of 37.5%, and InvenSense priced an upsized $150 million of five-year convertible senior notes after the market close on Wednesday at par to yield 1.75% with an initial conversion premium of 37.5%.

Seacor and InvenSense were not heard in trade in the secondary market.

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