NEW YORK – Opko Health announced on Wednesday that it is beginning a private offering of $200.0 million of its convertible senior notes due in 2029.
News of the plan drove Opko's share price down 27 percent to $1.09 in Thursday morning trading on the Nasdaq.
The company said in a statement that it also expects to grant the initial purchaser in the offering an option to purchase up to an additional $30.0 million of the notes, which will mature on Jan. 15, 2029. The firm noted that entities affiliated with Chairman and CEO Phillip Frost, Vice-Chairman and Chief Technical Officer Jane Hsiao, and other existing holders indicated an interest in acquiring approximately $70.0 million of convertible senior notes due in 2029 in exchange for approximately $70.0 million of Opko's existing 5 percent convertible promissory notes.
Up to $50.0 million of the net proceeds from the offering will be used to repurchase shares of Opko's common stock from purchasers of the senior notes in privately negotiated transactions, the company said.
The firm also expects to use some of the proceeds from the offering to enter into separate, privately negotiated transactions with at least one holder of Opko's outstanding 4.5 percent convertible senior notes due in 2025 to repurchase a portion of those notes. The rest of the proceeds from the offering will be used for general corporate purposes, Opko said.