Amicus Therapeutics, Inc. (NASDAQ:FOLD) says that it will be closing its previously announced private offering of $250 million aggregate principal amount of 3.00% convertible senior notes due 2023. However, the company has provided an option to the initial purchasers to purchase up to an additional $25 million collective primary amount of notes on the same terms and conditions. The approximation of aggregate net proceeds of the offering is at $243.0 million. The offering is only for qualified institutional buyers but pursuant to Rule 144A under the Securities Act.
The notes will be due December 15, 2023, and unless earlier repurchased or converted will yield interest at a rate of 3.00% per annum. This is due for payment semi-annually on June 15 and December 15 of each year, as from June 15, 2017. But at the same time, though at the option of the holder and in the guidance of certain circumstances, the notes are convertible. The preliminary conversion price of the notes is 163.3987 shares of Amicus’ common stock per $1,000 primary amount of notes, which is equivalent to $6.12 per share of Amicus’ common stock.
Amicus entered into privately negotiated capped call transactions
The role of the capped call transactions is to ensure the reduction of the potential dilution to existing stockholders while at the same time offseting potential cash payments. Thus, in connection with the pricing of the notes, the global biotechnology company has put on board Royal Bank of Canada (NYSE:RY), JPMorgan Chase & Co.(NYSE:JPM) the parent JPMorgan Chase Bank, National Association, an affiliate of J.P. Morgan Securities LLC, and Goldman Sachs Group Inc (NYSE:GS). About $13.5 million of the net proceeds from the offering has been used to fund the payment of the cost of the capped call transactions and another $82.2 million to refinance existing unsecured debt. The balance will be for general corporate purposes.
The company, which pursues treatment for orphan diseases, has a robust pipeline of advanced therapies. The therapies are of broad ranges given that they are of human genetic diseases. Amicus has a lead program that incorporates the development of small molecule pharmacological chaperone.
Amicus’ stock was trading at $4.67 a fall of $0.18 or 3.71%.