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Opko Prices $200M Convertible Senior Notes Offering

NEW YORK (360Dx) – Opko Health today priced its public offering of $200 million in convertible senior notes.

The notes will be senior unsecured obligations of the company and pay interest semiannually in arrears at a rate of 4.5 percent per year. The notes , which will mature on Feb. 15, 2025, will be convertible into, at the company's decision, cash, shares of the company's common stock, or a combination of both.

The conversion rate for the notes will initially be about 237 shares of common stock per $1,000 principal amount of the notes, which is equivalent to an initial conversion price of approximately $4.22 per share of common stock.

Opko has also granted the underwriter an option to purchase up to an additional $30 million in aggregate principal amount of the notes to cover any overallotments. Jefferies is the sole book-running manager for the offering.

Opko intends to use net proceeds received from the offering of the notes to fund R&D to further develop and commercialize its portfolio of proprietary pharmaceutical and diagnostic products. Proceeds will also be used for working capital, capital expenditures, acquisitions and other general corporate purposes, including the repayment or repurchase of indebtedness or debt securities outstanding, including $28.8 million principal amount and accrued but unpaid interest currently outstanding under the company's line of credit with an affiliate of the company's chairman and chief executive officer.

The sale of the notes is expected to close on February 7, 2019.

In connection with the company's offering of the notes, the company has entered into a share lending agreement with an affiliate of Jeffries under which Opko will lend it a total of up to 30 million newly shares of the company's common stock.

In morning trading today, Opko's shares on the Nasdaq were down more than 19 percent at $2.83.