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Array BioPharma, Inc. Message Board

  • urabt2 urabt2 Jun 3, 2013 4:30 PM Flag

    New convert issuance

    ARRY just announced up to $300 million of new convertible notes with the proceeds to be used to refi existing debt. No mentio of a strike price on the converts and there is a 5% greeenshoe I think. Hopefully the convert price is well into the $6s or $7s even.

    Sentiment: Strong Buy

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    • Here are the details:

      "The notes will be general senior unsecured obligations of Array. The notes will bear interest at a rate of 3.0% per year, payable semi-annually, and will mature on June 1, 2020. The notes will be convertible by the holders beginning March 1, 2020, or earlier upon specified events, and upon conversion, the holders will receive, at Array's option, shares of Array's common stock, cash or a combination of shares and cash. The notes will be convertible at an initial conversion rate of 141.8641 shares per $1,000 in principal amount of notes, equivalent to a conversion price of approximately $7.05 per share. Array may redeem some or all of the notes for cash under certain circumstances on or after June 4, 2017. Array anticipates that the offering will close on or about June 10, 2013, subject to customary closing conditions."

      They will use $92 MM to refi existing senior secured debt. 7 years and only about $1.60 in premium. I would rather hold those notes earning 3% than the stock, and they are senior secured claims as oposed to the lowest ranking common equity.

      Sentiment: Strong Buy

    • Taking a cue from CLDX and the price doubled after the financial picture was put in great order from a similar offering. Sorry!!! AH is fine.

    • Convertibe price needs to be close to $10. This number will always hold as a ceiling for the SP as the convertible holders will always short as the SP approaches this value. They are much better off getting the interest on the loan unless there is true demand to warrant the move above the strike.

    • Sorry. My mistake. My info was incorrect. It is a $100 MM convert with a greenshoe up to 15%. No strike price yet though. Goldman is involved so be prepared to be srewed.

      Sentiment: Strong Buy

      • 2 Replies to urabt2
      • I like this approach of paying off the Deerfield debt. JMHO.

      • Wel, I have bee here a year and a half, from what I can gather, the pipeline is advancing rather quickly and the CEO, Ron Squarer, has a great track record at previous companies, and has done well here. Raising money is part of doing business, and they have a lot of drugs in development, which is expensive. I will put my trust in Squarer, and I feel he will do what is best for the company.They have many huge investors, who, I am sure also had some imput on this. There is no need for small investors like myself to get on this board and gripe about dilution. If you do not like it, just sell and move on. I am sure the big smart money will be here in after hours and tomorrow morning to take your shares off your hands at a discount price. glta

        Sentiment: Strong Buy

4.07+0.01(+0.25%)Jul 11 4:00 PMEDT

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