Upsized SailPoint convertibles slip below par in secondary action; RWT adds with shares

By Rebecca Melvin

New York, Sept. 20 – The new SailPoint Technologies Holdings Inc.’s 0.125% convertibles were little changed early Friday after the Austin, Tex.-based security software company priced an upsized $350 million of the five-year paper at the tight end of talked terms. Later, the new notes slipped below par with the stock little changed at the close.

The deal was upsized from $300 million and came at the rich end of talk for a 0.125% to 0.625% coupon and 32.5% to 37.5% premium.

“The SAIL priced at the tight end of the range and upsized. It was higher in the gray but par bid on the break,” a New York-based trading source said.

The notes were par bid at the open and printed near the end of the session at 99.75. Shares of SailPoint slipped 7 cents to $20.60.

The new RWT Holdings Inc. 5.75% exchangeables added in secondary market action after the real estate investment trust subsidiary priced $175 million of the six-year paper.

Those “performed really well,” the trading source said of the RWT exchangeables.

They are not overly sensitive to the underlying stock, which is Redwood Trust Inc.’s common, and they were quoted 100.25 to 100.625 bid at the break.

The new RWT traded slightly more actively than the new SailPoint convertibles, according to Trace data, and printed at 100.375 late in the day. The RWT stock gained 0.7% to close at $16.58.

The week’s other new deals also featured in trade on Friday, including South Plainfield, N.J.-based PTC Therapeutics Inc.’s $250 million of 1.5% seven-year notes; Adesto Technologies Corp.’s $70 million of 4.25% five-year convertible notes; and Etsy Inc.’s $650 million of 0.125% seven-year notes.

The Esty convertibles were the day’s most active trade and were seen on the tape at 100.864, or up nearly a point outright. More than $46.3 million of the bond traded, which was more than double the next highest volume name, which was Finisar Corp.

On Thursday, upon release for secondary trading, the new Etsy convertibles opened flat to slightly higher on an outright basis but were unchanged to down 0.125 point on a hedged basis, according to market sources.

The notes were said to be 100 bid to 100.125 or 100.25 offered outright at the open. On swap, they traded down a touch versus the $59.45 closing share price, so 99.875 bid, 100 offered, a second New York-based market source said.

Finisar’s 0.5% convertibles due 2036 traded at 99.625, while Finisar shares popped at the market open and closed higher by 5% at $24.30.

Adesto’s 4.25% convertibles pulled back some after an outsized gain of 6.5 points outright on their debut. They were quoted on Trace at 102.25 late Friday versus Adesto’s common stock, which was up 16 cents, or 1.8%, to $9.13.

PTC Therapeutics’ 1.5% convertibles due 2026 also moved up by almost a point to 102.458.

PTC shares on Friday closed down 3 cents at $38.97.

Mentioned in this article:

Adesto Technologies Corp. Nasdaq: IOTS

Etsy Inc. Nasdaq: ETSY

Finisar Corp. Nasdaq: FNSR

PTC Therapeutics Inc. Nasdaq: PTCT

Redwood Trust Inc. NYSE: RWT

SailPoint Technologies Holdings Inc. Nasdaq: SAIL

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