Ironwood Pharmaceuticals Announces Full Exercise of Convertible Notes Over-Allotment
Ironwood estimates that the net proceeds of the offering will be approximately $390 million (including the previously announced net proceeds of approximately $341 million from the initial closing of the offering of Notes, which occurred on August 12, 2019) after deducting the initial purchaser's discounts and commissions, but prior to deducting estimated offering expenses. Ironwood plans to use approximately $3 million of the net proceeds from the offering of the Additional Notes to pay the cost of additional capped call transactions entered into in connection with the exercise of the initial purchaser's option. The cap price of the capped call transactions will initially be approximately $17.05 per share, which represents a premium of approximately 75% over the last reported sale price of Ironwood Class A common stock of $9.74 per share on August 7, 2019, and is subject to certain adjustments under the terms of the capped call transactions.
Ironwood intends to use the remaining net proceeds, together with cash on hand, to redeem all of its outstanding 8.375% Notes due 2026, repurchase approximately $215 million aggregate principal amount of its outstanding 2.25% Convertible Notes due 2022, and, to the extent additional proceeds are available, fund general corporate purposes.
The offer and sale of the Notes has not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws. The Notes may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act and any applicable state securities laws.
This news release does not constitute an offer to sell or a solicitation of an offer to buy the securities described herein, nor shall there be any sale of these securities, in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the laws of such jurisdiction.
About Ironwood Pharmaceuticals
Ironwood Pharmaceuticals (Nasdaq: IRWD) is a GI-focused healthcare company dedicated to creating medicines that make a difference for patients living with GI diseases. We discovered, developed and are commercializing linaclotide, the U.S. branded prescription market leader for adults with irritable bowel syndrome with constipation (IBS-C) or chronic idiopathic constipation (CIC).
We are also advancing two late-stage GI product candidates: IW-3718 is a gastric retentive formulation of a bile acid sequestrant being developed for the potential treatment of persistent gastroesophageal reflux disease, and MD-7246 is a delayed-release formulation of linaclotide that is being evaluated as an oral, intestinal, non-opioid, pain-relieving agent for patients suffering from abdominal pain associated certain GI diseases.
Ironwood was founded in 1998 and is headquartered in Cambridge, Mass. Any trademarks referred to in this press release are the property of their respective owners. All rights reserved.
This press release contains forward-looking statements. Investors are cautioned not to place undue reliance on these forward-looking statements, including, but not limited to, statements regarding the anticipated net proceeds of the offering and Ironwood's anticipated use of the net proceed from the sale of the Notes. Each forward‐looking statement is subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in such statement. Applicable risks and uncertainties include, but are not limited to, those related to whether or not Ironwood will be able to consummate the closing of the Additional Notes and the capped call transactions. In addition, Ironwood's management retains broad discretion with respect to the allocation of the net proceeds of this offering and its future use of cash. Applicable risks also include those that are listed under the heading "Risk Factors" and elsewhere in Ironwood's Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 and in Ironwood's subsequent SEC filings. These forward-looking statements (except as otherwise noted) speak only as of the date of this press release and Ironwood undertakes no obligation to update these forward-looking statements.
Source: Ironwood Pharmaceuticals, Inc.