A Medical Device Daily
Aspect Medical Systems (Norwood, Massachusetts) reported that it has priced its previously disclosed private placement of $110 million aggregate principal amount of 2.5% convertible senior notes due 2014 to qualified institutional buyers (Medical Device Daily, June 14, 2007). Aspect Medical has granted the initial purchaser of the notes an option to purchase up to an additional $15 million principal amount of notes.
The notes will pay interest semi-annually at a rate of 2.5% per annum. The notes will be convertible under certain circumstances into shares of Aspect Medical's common stock at an initial conversion rate of 52.4294 shares per $1,000 principal amount of notes. This is equivalent to an initial conversion price of $19.07 per share, which represents a conversion premium of about 22.5% based on the closing price of $15.57 of Aspect Medical's common stock on June 14 on the NASDAQ Global Market.
The sale of the notes is expected to close on June 20, 2007, subject to customary closing conditions.
Aspect said it expects to use a portion of the net proceeds from the offering to repurchase about 2 million additional shares of its common stock from Boston Scientific Corporation upon exercise of a portion of its option to purchase shares of its common stock held by Boston Scientific.
This option was granted by Boston Scientific in connection with the previously reported termination and repurchase agreement that Aspect Medical entered into with Boston Scientific last week (MDD, June 13, 2007).
Aspect already repurchased 2 million shares of its common stock from Boston Scientific on June 13 under the termination and repurchase agreement, leaving Boston Scientific with 4,013,239 shares of Aspect Medical common stock.
The company has the right to purchase the 4 million remaining shares of its common stock held by Boston Scientific at a purchase price per share equal to the greater of $15 and the average of the closing prices of Aspect Medical's common stock as reported on the NASDAQ Global Market for the 10 consecutive trading days up to and including the date of the exercise of such option by the company
Assuming Aspect purchases the option shares at a purchase price of $15.57 per share, which was the closing price of Aspect's common stock on June 14, it would use about $31.1 million of the net proceeds of the offering to purchase such shares.
In addition, the company plans to use a portion of the net proceeds from the offering to purchase up to an additional 1 million shares of its common stock in privately negotiated transactions concurrently with this offering. It intends to use the remaining net proceeds for general corporate purposes which may include purchases of the balance of the shares of its common stock owned by Boston Scientific, investments in its neuroscience program and acquiring, licensing or investing in complementary businesses, technologies or products.
In other financing news, Fresenius Medical Care (Bad Homburg, Germany), a producer of dialysis products and services, reported that the share split with capital increase from the company's funds approved by the ordinary general meeting on May 15 will become effective today.
Starting today, the shares will be traded "ex split" and the shareholders' deposits will be adapted to the new number of shares. Every holder of an ordinary share now holds three ordinary shares and every holder of a preference share holds three preference shares. As a result of the share split, the price level will be reduced arithmetically without affecting the overall value for shareholders.
The subscribed capital of Fresenius Medical Care now amounts to 1295.42 million, divided into 291.70 million ordinary shares and 3.72 million preference shares.