LivaNova PLC (Nasdaq: LIVN), a market-leading medical technology
company, today announced its intention to offer $300 million
aggregate principal amount of convertible senior notes due 2029
(the “notes”) in a private offering only to persons reasonably
believed to be qualified institutional buyers pursuant to Rule 144A
under the Securities Act of 1933, as amended (the “Securities
Act”), subject to market conditions and other factors. LivaNova
also intends to grant to the initial purchasers of the notes an
option to purchase, within a 13-day period beginning on, and
including, the date on which the notes are first issued, up to an
additional $45 million aggregate principal amount of the notes.
The notes will be senior, unsecured obligations of LivaNova.
Prior to December 15, 2028, the notes will be convertible only upon
satisfaction of certain conditions. On or after December 15, 2028
until the close of business on the second scheduled trading day
immediately preceding the maturity date, the notes may be converted
at any time. LivaNova will satisfy any conversion of notes by
paying cash up to the aggregate principal amount of such notes
being converted and paying or delivering, as the case may be, cash,
ordinary shares of LivaNova, or a combination of cash and ordinary
shares, at LivaNova’s election, in respect of the remainder, if
any, of LivaNova’s conversion obligation in excess of the aggregate
principal amount of such notes being converted.
The notes will mature on March 15, 2029, unless earlier
converted, redeemed or repurchased. LivaNova may redeem the notes
at its option, on or after March 22, 2027, in whole or in part, if
the last reported sale price of LivaNova’s ordinary shares has been
at least 130% of the conversion price then in effect for at least
20 trading days (whether or not consecutive) during any 30
consecutive trading day period (including the last trading day of
such period) ending on, and including, the trading day immediately
preceding the date on which LivaNova provides notice of redemption.
The redemption price will be equal to 100% of the principal amount
of the notes to be redeemed, plus accrued and unpaid interest, if
any, to, but excluding, the redemption date. LivaNova may also
redeem the notes at its option, at any time, in whole but not in
part, upon the occurrence of certain tax-related events.
The interest rate, conversion rate and other terms of the notes
are to be determined upon pricing of the offering.
In connection with the pricing of the notes, LivaNova expects to
enter into privately negotiated capped call transactions with one
or more of the initial purchasers in the notes offering or their
respective affiliates and/or other financial institutions (the
“option counterparties”) having an expiration date that is the same
as the maturity date of the notes. The capped call transactions
would cover, subject to anti-dilution adjustments substantially
similar to those applicable to the notes, the number of LivaNova’s
ordinary shares underlying the notes and are expected generally to
compensate (through the payment of cash to LivaNova) for potential
dilution to LivaNova’s ordinary shares upon conversion of the notes
and to offset any cash payments made in excess of the principal
amount of converted notes in the event that the market price per
ordinary share, as measured under the terms of the capped call
transactions, is greater than the strike price of the capped call
transactions, with such compensation and/or offset being subject to
a cap. If the initial purchasers of the notes exercise their option
to purchase additional notes, LivaNova expects to enter into
additional capped call transactions with the option
counterparties.
LivaNova expects that, in connection with establishing their
initial hedges of the capped call transactions, the option
counterparties or their respective affiliates will purchase
LivaNova’s ordinary shares and/or enter into various derivative
transactions with respect to LivaNova’s ordinary shares
concurrently with or shortly after the pricing of the notes. This
activity could increase, or reduce the size of any decrease in, the
market price of the ordinary shares or the notes at that time. In
addition, LivaNova expects that the option counterparties or their
respective affiliates may modify their hedge positions by entering
into or unwinding various derivatives with respect to LivaNova’s
ordinary shares and/or by purchasing or selling ordinary shares or
other securities of LivaNova in secondary market transactions
following the pricing of the notes and prior to the maturity of the
notes and are likely to do so (x) during the observation period
related to conversions of notes on or after December 15, 2028, (y)
during any observation period related to a conversion of notes
prior to the close of business on the business day immediately
preceding December 15, 2028, if LivaNova elects to unwind a
corresponding portion of the capped call transactions in connection
with such conversion and (z) following any repurchase of notes by
LivaNova if LivaNova elects to unwind a corresponding portion of
the capped call transactions in connection with such repurchase.
This activity could also cause or avoid an increase or a decrease
in the market price of LivaNova’s ordinary shares or the notes,
which could affect the ability of noteholders to convert their
notes and, to the extent the activity occurs following conversion
or during any observation period related to a conversion of the
notes, it could affect the amount and value of the consideration
that noteholders will receive upon conversion of their notes.
LivaNova’s wholly-owned U.S. subsidiary, LivaNova USA, Inc., is
also considering entering into one or more separate and
individually negotiated transactions with one or more holders of
its 3.00% Cash Exchangeable Senior Notes due 2025 (the “cash
exchangeable senior notes”) to repurchase for cash a portion of the
cash exchangeable senior notes on terms to be negotiated separately
with each holder (each, a “note repurchase”). The cash exchangeable
senior notes were issued by LivaNova USA, Inc. and are guaranteed
by LivaNova. Any terms of each note repurchase are anticipated to
be individually negotiated with each holder of the cash
exchangeable senior notes and will depend on several factors,
including the market price of LivaNova’s ordinary shares and the
trading price of the cash exchangeable senior notes at the time of
each such note repurchase. No assurance can be given as to how
much, if any, of the cash exchangeable senior notes will be
repurchased or the terms on which they will be repurchased.
LivaNova USA, Inc. intends to negotiate the note repurchases
through one of the initial purchasers and/or its affiliate who
would repurchase any such cash exchangeable senior notes from
holders and resell them to LivaNova USA, Inc. on or about the
closing date of this offering.
LivaNova expects that holders of the cash exchangeable senior
notes that sell their cash exchangeable senior notes to LivaNova
USA, Inc. as described above and that have hedged their equity
price risk with respect to such cash exchangeable senior notes may
enter into or unwind various derivatives with respect to LivaNova’s
ordinary shares (including entering into derivatives with one or
more of the initial purchasers in this offering or their respective
affiliates) and/or purchase ordinary shares concurrently with or
shortly after the pricing of the notes. This activity could
increase, or reduce the size of any decrease in, the market price
of LivaNova’s ordinary shares, including concurrently with the
pricing of the notes, resulting in a higher effective conversion
price of the notes.
In connection with the issuance of the cash exchangeable senior
notes, LivaNova USA, Inc. entered into capped call transactions
with certain financial institutions. To the extent LivaNova USA,
Inc. effects any note repurchases, it intends to enter into
agreements with those financial institutions to terminate a portion
of those capped call transactions in a notional amount
corresponding to the amount of cash exchangeable senior notes
repurchased. In connection with any such termination of any of the
existing capped call transactions and the related unwinding of the
existing hedge positions of LivaNova USA, Inc.’s counterparties to
those capped call transactions, those counterparties and/or their
respective affiliates may unwind various derivatives with respect
to LivaNova’s ordinary shares and/or sell ordinary shares
concurrently with or shortly after pricing of the notes. This
activity could decrease, or reduce the size of any increase in, the
market price of LivaNova’s ordinary shares at that time and could
decrease, or reduce the size of any increase in, the market value
of the notes.
The note repurchases and the unwind of the existing capped call
transactions described above, and the potential related market
activities by holders of the cash exchangeable senior notes
participating in the note repurchases and by the financial
institutions party to the capped call transactions, could increase,
or reduce the size of any decrease in, or decrease, or reduce the
size of any increase in, the market price of LivaNova’s ordinary
shares, which may affect the trading price of the notes being
offered and the initial conversion price of the notes. LivaNova
cannot predict the magnitude of such market activity or the overall
effect it will have on the price of the notes being offered or
LivaNova’s ordinary shares.
Additionally, LivaNova is actively engaged in negotiations with
respect to, and has the intention to enter into, an incremental
facility amendment to its existing credit agreement in order to
increase the aggregate principal amount available to LivaNova under
its revolving credit facility and decrease the margin under such
facility. However, there is no assurance that the completion of
such amendment will be achieved.
LivaNova expects to use the net proceeds of the offering and the
unwind of the existing capped call transactions, after fees,
discounts, commissions and other offering expenses, (i) to pay the
cost of the capped call transactions described above, (ii) to pay
the cost of the note repurchases described above and (iii) to the
extent LivaNova has remaining proceeds after satisfying the
foregoing, for general corporate purposes.
The notes will only be offered to persons reasonably believed to
be qualified institutional buyers pursuant to Rule 144A under the
Securities Act. The notes have not been, nor will they be,
registered under the Securities Act or the securities laws of any
other jurisdiction, and unless so registered, they may not be
offered or sold in the United States except pursuant to an
applicable exemption from such registration requirements. LivaNova
will apply for the listing of the notes on The International Stock
Exchange in Guernsey.
This press release does not constitute an offer to sell or a
solicitation of an offer to buy, nor shall there be any offer or
sale of, the notes in any state or jurisdiction in which the offer,
solicitation or sale of the notes would be unlawful prior to the
registration or qualification thereof under the securities laws of
any such state or jurisdiction. This press release does not
constitute an offer or solicitation to participate in any note
repurchase.
This press release and any other documents or materials relating
to the offering are for distribution (a) within the European
Economic Area only to persons who are Qualified Investors as
defined in Article 2(e) of Regulation (EU) 2017/1129; and (b)
within the United Kingdom only to persons who are Qualified
Investors as defined in Article 2(e) of Regulation (EU) 2017/1129
as it forms part of the domestic law of the United Kingdom by
virtue of the European Union (Withdrawal) Act 2018, as amended, and
who are (i) investment professionals falling within Article 19(5)
of the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2005 (the Order), (ii) high-net-worth companies,
unincorporated associations and partnerships and trustees of
high-value trusts as described in Article 49(2)(a) to (d) of the
Order or (iii) other persons to whom they may otherwise lawfully be
communicated (all such persons in (a) and (b) together being
referred to as Relevant Persons). In the European Economic Area and
the United Kingdom, the notes are only available to, and any
invitation, offer or agreement to subscribe, purchase or otherwise
acquire such notes will be engaged in only with, Relevant Persons.
In the European Economic Area and the United Kingdom, any person
who is not a Relevant Person should not act or rely on this press
release or any of its contents or any such other document or
materials.
About LivaNova
LivaNova PLC is a global medical technology company built on
nearly five decades of experience and a relentless commitment to
provide hope for patients and their families through medical
technologies, delivering life-changing improvements for both the
Head and Heart. Headquartered in London, LivaNova employs
approximately 2,900 employees and has a presence in more than 100
countries for the benefit of patients, healthcare professionals and
healthcare systems worldwide.
Safe Harbor Statement
This news release contains “forward-looking statements”
concerning LivaNova’s goals, beliefs, expectations, strategies,
objectives, plans and underlying assumptions and other statements
that are not necessarily based on historical facts. These
statements include, but are not limited to, statements regarding
the potential notes offering, capped call transactions, repurchases
of the cash exchangeable senior notes, and unwind of the existing
capped call transactions, the potential terms thereof, and the use
of any proceeds if the notes offering is successful. Actual results
may differ materially from those indicated in LivaNova’s
forward-looking statements as a result of various factors,
including those factors set forth in Item 1A of LivaNova’s Annual
Report on Form 10-K for the year ended December 31, 2023, as
supplemented by any risk factors contained in LivaNova’s Current
Reports on Form 8-K. We undertake no obligation to update the
information contained in this press release to reflect subsequently
occurring events or circumstances.
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LivaNova Investor Relations and Media Contacts +1
281-895-2382 Briana Gotlin Director, Investor Relations
InvestorRelations@livanova.com Deanna Wilke VP, Corporate
Communications Corporate.Communications@livanova.com
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