Morning Commentary: Theravance comes upsized; NetSuite drifts on Oracle speculation; NXP eyed

By Stephanie N. Rotondo

Seattle, Oct. 28 – The convertible bond market was as subdued as it has been all week in early Friday dealings.

However, topical names were moving around.

For instance, Theravance Biopharma Inc.’s $200 million of 3.25% convertible senior notes due 2023 – a deal priced overnight – were on the active side, trading around par, according to a market source.

The deal came with a 32.5% initial conversion premium, which was at the rich end of the 27.5% to 32.5% price talk. The coupon was talked in a 3% to 3.5% range.

The deal was upsized from $150 million.

In addition to the convertibles sale, the Dublin-based biopharmaceutical company also sold $100.1 million of ordinary shares.

In response, the company’s stock (Nasdaq: TBPH) traded off, falling $1.49, or 5.61%, to $25.06 by mid-morning.

Also active was NetSuite Inc.’s 0.25% convertible notes due 2018. The bonds, as well as the equity, were trading off as investors speculate on whether or not a takeover bid made by Larry Ellison’s Oracle Corp. will be accepted or not.

The convertibles were seen straddling 105 against a share price of $93.67.

NXP Semiconductors NV remained in focus following Thursday’s news that Qualcomm Inc. had made a $39 billion bid for the chipmaker.

The 1% convertible notes due 2019 were slightly better in early trading, at 114.875. The stock (Nasdaq: NXPI) was 88 cents higher at mid-morning at $99.96.

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