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Alignment Healthcare Announces Private Convertible Senior Notes Transaction
Proceeds to be used to lower the Company’s cost of capital by repaying the Company’s existing term loan facility and for general corporate purposes ORANGE,
About this update from Alignment Healthcare, Inc.
[{"type":"text","content":"Proceeds to be used to lower the Company’s cost of capital by repaying the Company’s existing term loan facility and for general corporate purposes\nORANGE, Calif., Nov. 15, 2024 (GLOBE NEWSWIRE) -- Alignment Healthcare, Inc. (NASDAQ: ALHC) (the “Company”) today announced that it has entered into privately negotiated subscription agreements with certain investors, pursuant to which it will issue $330 million principal amount of 4.25% Convertible Senior Notes due 2029 (the “Notes”). The issuance of the Notes is expected to close on November 22, 2024, subject to customary closing conditions. The Notes will be senior, unsecured obligations of the Company, and interest will be payable semi-annually in arrears at a rate of 4.25% per annum. The Notes will mature on November 15, 2029, unless earlier repurchased, redeemed or converted in accordance with their terms. The conversion price for the Notes will initially be approximately $16.04, which represents a premium of 25% to the closing price of the Company’s common stock on November 14, 2024. The Company anticipates the net cash proceeds from the issuance of the Notes will be approximately $321.05 million, after subtracting fees, discounts, and estimated expenses in connection with the transaction. The Company intends to use the proceeds to lower its cost of capital by repaying the Company’s existing term loan facility, which bears interest at SOFR + 6.5%, and for general corporate purposes. In connection with the issuance of the Notes, the Company has been advised that the placement agent for the Notes intends to purchase approximately 3.442 million shares of the Company’s common stock in privately negotiated transactions from certain purchasers of the Notes through a financial intermediary at a discount to the last reported sale price of the Company’s common stock on November 14, 2024. Such purchases by the placement agent of the Company’s common stock could increase (or reduce the size of any decrease in) the market price of the common stock or the Notes. Additional information regarding this announcement may be found in a Current Report on Form 8-K that the Company intends to file with the U.S. Securities and Exchange Commission (the “SEC”). This announcement is neither an offer to sell nor a solicitation of an offer to buy any of these securities (including the shares of Company ...