Midday Commentary: Live Nation's planned $250 million of convertibles looks cheap; Post plans units

By Rebecca Melvin

New York, May 19 - Live Nation Entertainment Inc.'s $250 million convertible deal, which launched early Monday, was looking fairly cheap at the midpoint of talk, using a credit spread of 325 basis points over Libor and a 28% vol., according to a market source.

The Live Nation deal was worth about 102.625 at the midpoint of 2.5% to 3% coupon talk and 47.5% to 52.5% premium talk, the source said.

Live Nation is also planning $250 million of straight notes and will use proceeds to buy back its 2.875% convertibles that are putable this year.

Post Holdings Inc. also launched an offering of $200 million of tangible equity units, or 2 million units at $100 per unit, early Monday that were talked to yield 5.75% to 6.25% with a threshold appreciation premium of 17.5% to 22.5%. That deal was seen pricing after the market close Wednesday, while the Live Nation deal was seen pricing late Monday or early Tuesday.

Elsewhere, Spirit Realty Capital Inc.'s 2.875% convertible due 2019, which priced last week, was trading actively and slightly better by about 0.25 point or so. The notes were last seen at 100.625, according to Trace data, which was up from about 100.375 on Friday.

Spirit Realty's 3.75% notes due 2021, which priced at the same time, were not seen in trade. But the two tranches had seen pricing that was nearly identical on their debut in secondary trading on Thursday.

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