Mesoblast Announces Debt Refinancing And Expansion With Oaktree Capital

Mesoblast Announces Debt Refinancing And Expansion With Oaktree Capital
  • Mesoblast Limited MESO refinanced its existing senior debt facility with a new $90 million five-year facility provided by Oaktree Capital Management LP.
  • Mesoblast drew the first tranche of $60 million on closing, with proceeds being used to repay the outstanding balance of the existing senior debt facility with Hercules Capital Inc.
  • An additional $30 million may be drawn by December 31, 2022, subject to certain milestones. 
  • The facility has a three-year interest-only period, at a rate of 9.75% per annum. After this time, 40% of the principal amortizes over two years, and the final payment is due November 2026. 
  • Oaktree will also receive warrants to purchase 1.77 million ADS at $7.26 per ADS, a 15% premium to the 30-day VWAP. 
  • The warrants may be exercised within seven years of issuance.
  • "We recognize the quality of the portfolio and the significant near-term milestones that could help the company successfully commercialize its first product in the US," said Oaktree's Aman Kumar, Co-Portfolio Manager of Life Sciences Lending.
  • Cantor Fitzgerald & Co. acted as exclusive arranger and financial advisor to Mesoblast.
  • Related: Mesoblast's Remestemcel Shows Promising Action In Patients With Heart Failure.
  • Price Action: MESO share closed at $6.24 on Friday.
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