Ironwood Proposes Offering of $330 Million of Convertible Senior Notes

Ironwood Pharmaceuticals, Inc. (“Ironwood”) (Nasdaq: IRWD), a GI-focused healthcare company, today announced that it intends to offer, subject to market and other conditions, $165 million aggregate principal amount of convertible senior unsecured notes that will mature on June 15, 2024 (the “2024 Notes”) and $165 million aggregate principal amount of convertible senior unsecured notes that will mature on June 15, 2026 (the “2026 Notes” and, together with the 2024 Notes, the “Notes”). The Notes will be offered and sold to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). Ironwood also expects to grant the initial purchaser of the Notes an option to purchase, within a 13-day period from, and including, the date of original issuance of the Notes up to an additional $25 million aggregate principal amount of the 2024 Notes and $25 million aggregate principal amount of the 2026 Notes.

The Notes will bear cash interest, payable on June 15 and December 15 of each year, beginning on December 15, 2019. The Notes will not be redeemable prior to maturity. The Notes will be convertible, only during certain periods and subject to certain circumstances, into cash, shares of Ironwood Class A common stock (“Ironwood common stock”), or a combination of cash and shares of Ironwood common stock, at Ironwood’s election. Final terms of the Notes, including interest rate, conversion rate, conversion price, and certain other terms of the offering, will be determined at the time of pricing.

Ironwood intends to use the net proceeds, together with cash on hand, to redeem all of its outstanding 8.375% Notes due 2026, repurchase approximately $185 million aggregate principal amount of its outstanding 2.25% Convertible Notes due 2022 (“the existing convertible notes”), pay the cost of the capped call transactions (described below) and, to the extent additional proceeds are available, fund general corporate purposes. Ironwood currently expects to settle the remaining principal amount of the existing convertible notes in cash at maturity.

https://www.biospace.com/article/releases/ironwood-pharmaceuticals-announced-proposed-offering-of-330-million-of-convertible-senior-notes/