Convertibles trading light; Dermira notes improve; Fortive active in secondary market

By Abigail W. Adams

Portland, Me., April 8 – The convertibles secondary space was off to a sleepy start on Monday with about $59 million on the tape one hour into the session and $281 million in reported volume shortly before the market close.

Investment-grade convertible notes were in focus and dominated trading activity on an otherwise quiet day.

Euronet Worldwide Inc.’s 0.75% convertible notes due 2049 were major volume movers in the secondary space with the notes making gains on an outright basis.

Fortive Corp.’s 0.875% convertible notes due 2022 were also among the most actively traded during Monday’s session although the notes were largely moving sideways.

While trading activity surrounding recent issues quieted down, Bilibili Inc.’s 1.375% convertible notes due 2026 remained active with the greenshoe on the notes recently exercised in full.

Dermira Inc.’s 3% convertible notes due 2021 were also active and making gains as stock continued its upward momentum on Monday.

Investment grade in focus

Investment-grade convertible notes were in focus on an otherwise slow day in the convertibles space on Monday.

Euronet Worldwide’s 0.75% convertible notes due 2049 were among the most actively traded issues in the secondary space with the notes making gains alongside stock.

The 0.75% notes were up about 1 point outright. They were changing hands just shy of 110 in the late afternoon.

More than $16 million of the bonds were on the tape shortly before the market close.

Euronet stock closed Monday at $143.51, an increase of 0.53%.

The 0.75% convertible notes also rose about 2 points on Friday as stock climbed 1.21%.

Fortive’s 0.875% convertible notes due 2022 were also major volume movers of the session with more than $14 million of the bonds on the tape by the late afternoon.

While active, the notes were largely moving sideways.

The 0.875% notes were changing hands at 106.375 in the late afternoon.

Fortive stock closed Monday at $86.93, an increase of 0.23%.

Bilibili’s greenshoe

Bilibili’s 1.375% convertible notes remained one of the top traded issues in the secondary space even as activity surrounding recent deals slowed on Monday.

The 1.375% convertible notes continued to solidify above par. The notes were up about 0.5 point outright.

They were changing hands around 100.625 in the late afternoon, according to a market source.

The notes were largely moving in line on a dollar-neutral, or hedged, basis, a market source said.

More than $8 million of the bonds were on the tape shortly before the market close.

Bilibili’s American Depositary Shares closed Monday at $17.91, a decrease of 0.61%.

The greenshoe on Bilibili’s 1.375% offering was recently exercised in full, lifting the size of the deal to $500 million.

While the notes traded as high as 102 on their market debut on April 3, they dropped to 98.875 the following day.

However, the notes closed Friday above par.

Dermira improves

Dermira’s 3% convertible notes due 2021 saw renewed attention on Monday with the off-the-run name active in the secondary space, sources said.

The notes were making gains on both an outright and dollar-neutral basis.

The 3% convertible notes were up about 1.375 points outright.

They were changing hands around 91.75 early in the session and traded at 91.8 versus an equity price of $14.93 later in the afternoon.

The notes were improved about 0.5 point dollar-neutral, a market source said.

About $8 million of the bonds were on the tape by the late afternoon.

Dermira stock traded as high as $15.48 but closed the day at $14.82, an increase of 1.79%.

Stock jumped more than 8% on Friday on news that Partner Fund Management LP had increased its stake in the biotech company to 6%, a source said.

Dermira’s stock has seen steady increases since mid-March when it released positive data from a phase 2 clinical trial for a treatment of a severe form of eczema.

Dermira is also slated to present at the Needham health care conference.

Mentioned in this article:

Bilibili Inc. Nasdaq: BILI

Dermira Inc. Nasdaq: DERM

Euronet Worldwide Inc. Nasdaq: EEFT

Fortive Corp. NYSE: FTV

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