Indivior Pharmaceuticals, Inc. (NASDAQ: INDV) saw its shares fall roughly 8% after disclosing plans to offer $400 million of convertible senior notes due 2031 in a private placement to qualified institutional buyers.
The company described the securities as senior, unsecured obligations that will accrue interest payable on a semi-annual basis and mature on March 15, 2031. Noteholders will have conversion rights under specified conditions; Indivior said it will settle conversions either by paying cash or by delivering cash and, if applicable, shares of its common stock.
Indivior stated it intends to allocate about $239 million of the net proceeds from the offering, together with roughly $102 million of cash on hand, to repay outstanding borrowings and to terminate its term loan and revolving credit facility. In addition, the company plans to use up to about $75 million of the proceeds to repurchase shares of its common stock from certain purchasers of the notes in privately negotiated transactions that would occur concurrently with the pricing of the offering.
The notes include an issuer redemption feature. Indivior may elect to redeem the notes on or after March 20, 2029, but only if the last reported sale price per share of its common stock exceeds 130% of the conversion price for a specified period and other conditions are satisfied. The company also disclosed that, if certain fundamental change events take place, holders of the notes could require Indivior to repurchase their notes at a cash price equal to the principal amount plus any accrued and unpaid interest.
Indivior has granted the initial purchasers a 30-day option to acquire up to an additional $60 million principal amount of notes. The final terms of the offering, which will include the interest rate and the initial conversion rate, will be determined at the pricing of the notes.
Further details and context provided by the company:
- The offering is being conducted as a private placement and is limited to qualified institutional buyers.
- Conversions may be settled in cash or in a combination of cash and shares, as applicable.
- Proceeds will be applied primarily to repay and terminate existing debt facilities, with a component reserved for targeted repurchases from certain note purchasers.
Final interest and conversion mechanics remain subject to determination at pricing, and the company emphasized that the redemption and repurchase provisions are contingent on specified conditions described in its offering disclosure.