OPKO Health talks $200 million five-year convertible notes to yield 3.25%-3.75%, up 25%-30%

By Abigail W. Adams

Portland, Me., Jan. 3 – OPKO Health Inc. plans to price $200 million of five-year convertible notes after the market close on Thursday with price talk for a coupon of 3.25% to 3.75% and an initial conversion premium of 25% to 30%.

J.P. Morgan Securities LLC is bookrunners for the Rule 144A offering, which carries a greenshoe of $30 million.

The notes are non-callable.

They are putable upon a fundamental change.

The company will enter into privately negotiated transactions to repurchase a portion of its outstanding 4.5% convertible notes due 2025.

In a concurrent private placement, entities affiliated with OPKO chair and CEO Phillip Frost, OPKO vice-chair and chief technical officer Jane Hsiao and other existing holders plan to acquire $70 million of the 2029 convertible notes in exchange for $70 million of 5% convertible promissory notes, which will include about $5 million in unpaid interest.

Proceeds will be used to repurchase up to $50 million of stock in privately negotiated transactions with the initial purchasers of the notes and repurchase the 4.5% convertible notes due 2025 with remaining proceeds to be used for general corporate purposes.

OPKO Health is a Miami-based biopharmaceutical and diagnostics company.

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