Tandem Diabetes Care Inc. has announced that it will price $275 million in 1.50% Convertible Senior Notes due by 2029 in a private placement. In a noticeable rise from their initial offering of $250 million, this shows the company's increasing financial strength.
Additionally, Tandem has offered the initial note buyers an opportunity to purchase an extra $41.25 million within the first 13 days of issue.
The sale of these notes is scheduled to close on March 8, 2024. Importantly, they will be Tandem’s general unsecured obligations, accruing semiannual interest at a rate of 1.50% until maturation on March 15, 2029.
After deducting initial purchaser fees and predicted offering expenses, Tandem expects a net profit of approximately $266.3 million from this offering. If the option for additional purchases is fully exercised, this could provide a substantial increase to about $306.4 million.
Tandem plans to utilize the net proceeds, along with on-hand cash, to cover the cost of the capped call transactions, which is roughly $13.8 million. They also aim to repurchase $246.7 million of its 1.50% Convertible Senior Notes due in 2025 and about $30.0 million of common stock, both in private transactions in line with the note offering pricing.
