NEW YORK – NantHealth said Wednesday that it has reached agreements for $137.5 million in new financing that will extend the maturity date of existing debt instruments to 2026. The transaction will close no later than April 27.
Under the deal, El Segundo, California-based NantHealth is issuing new senior unsecured convertible notes with a 2026 maturity to existing investors Highbridge Capital Management and Nant Capital. The latter is an investment vehicle of NantHealth's founder and CEO, Patrick Soon-Shiong, who is also the firm's largest shareholder.
The firm plans to use the proceeds of the new 2026 notes to retire existing convertible notes that are due in December, as well as for operating capital.
The 2026 notes will carry an interest rate of 4.5 percent, payable semiannually, though NantHealth said that investors will be able to convert the instruments to company stock. Terms will be disclosed in a future filing with the US Securities and Exchange Commission.
Additionally, Highbridge and Cambridge Equities — another Soon-Shiong company — have each agreed to convert $5 million of their investments in the 2021 notes into NantHealth common stock as of Wednesday. The stock closed Tuesday at $2.96 per share.
"Not only does this financing address the upcoming maturity of our 2021 notes, but importantly provides us with the resources to invest in our established businesses, NaviNet and Eviti, and accelerate the expansion of our recently acquired OpenNMS business," NantHealth Chief Operating Officer Ron Louks said in a statement.
"Last year, NantHealth made a strategic decision to expand beyond healthcare by providing enterprise solutions to help businesses in other industries," said Jonathan Segal, co-chief investment officer of Highbridge, referring to the July 2020 acquisition of OpenNMS Group, an open-source network management company. "We believe this financing will help NantHealth achieve this goal and continue further product expansion."