SanDisk expands on swap after revenue view cut; buyers seen in NXP; Synergy exploring sale

By Rebecca Melvin

New York, March 26 – SanDisk Corp. was the name of the day in the convertibles market on Thursday, with its two sister bonds dropping sharply on an outright basis along with the underlying shares but jumping on a hedged basis after the Milpitas, Calif.-based data storage chip company cut its first-quarter and 2015 revenue outlook and withdrew other forecasts for the same time periods.

The two SanDisk bonds were said to have expanded about 2 points on swap.

“It’s all SanDisk today,” a New York-based trader said.

Several other names in the semiconductor sector, of which the convertibles space has a good number, were better on the day, including the convertibles of Microchip Technology Inc. and NXP Semiconductors NV, a trader said.

Elsewhere, Synergy Pharmaceuticals Inc.’s shares popped after a report that the New York-based biopharmaceutical company is weighing options, including a sale of itself.

A level on Synergy’s 7.5% convertible bonds due 2019 was quoted at 135.125 bid, 138.125 offered versus a share price of $4.20, but it was not heard to have traded there, according to a trader.

Synergy shares gained 29 cents, or 8%, to $4.11.

Stocks fluctuated and ended in negative territory, but well off their lows for the day. The Nasdaq composite index, which took a significant hit on Wednesday, ended down 13.16 points, or 0.3%, to 4,863.36.

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