Closes $250 Million Term B Loan
Refinancing plan expected to reduce the associated current cash
interest expense by nearly one-half
BRISBANE, Calif.--(BUSINESS WIRE)--
Innoviva, Inc. ("Innoviva" or the "Company") (NASDAQ: INVA) today
announced the closing of a $250 million Term B Loan (the "Term B Loan"),
the proceeds of which were used to repay the remaining balance of the
Company's LABA PhaRMAsm 9.0% fixed rate term notes due 2029
(the "2029 Notes"). The closing of the Term B Loan follows the
previously announced closing on August 7, 2017 of the Company's offering
of 2.50% convertible senior notes due 2025 (the "2025 Notes") for gross
proceeds of $192.5 million in aggregate principal. The proceeds from
these financings provided the Company with the capital to fully
refinance the 2029 Notes, which is expected to substantially reduce
Innoviva's interest expenses, by lowering the Company's current total
weighted average interest cost to approximately 3.6% per annum.
The Term B Loan will mature in August 2022, bears interest at a rate
equal to LIBOR plus 4.5% (or, at the Company's option, a certain
alternate base rate plus 3.5%) and requires a 10% minimum annual
principal repayment. The Company and the Term B Loan received ratings
from Standard & Poors of B+ and BB respectively with a "stable" outlook,
and from Moody's of B3 and Ba3 respectively with a "stable" outlook. The
Term B Loan was led by Morgan Stanley Senior Funding, Inc. as
administrative agent, collateral agent, sole lead arranger and joint
bookrunner and Merrill Lynch, Pierce, Fenner & Smith Incorporated as
joint bookrunner.
"The refinancing of Innoviva's 2029 Notes has long been an important
part of our strategy for dramatically reducing expenses," said Michael
W. Aguiar, President and Chief Executive Officer of Innoviva. "As a
result of this refinancing, based on today's rates, we have reduced our
largest expense by more than $18 million on an annual run-rate basis,
which we believe will increase our operating flexibility and illustrates
our ongoing commitment to maximizing shareholder value."
About Innoviva
Innoviva is focused on bringing compelling new medicines to patients in
areas of unmet need by leveraging its significant expertise in the
development, commercialization and financial management of
bio-pharmaceuticals. Innoviva's portfolio is anchored by the respiratory
assets partnered with Glaxo Group Limited (GSK), including RELVAR®/BREO®
ELLIPTA® and ANORO® ELLIPTA®, which were jointly developed by Innoviva
and GSK. Under the agreement with GSK, Innoviva is eligible to receive
associated royalty revenues from RELVAR®/BREO® ELLIPTA®, ANORO®
ELLIPTA®. In addition, Innoviva retains a 15 percent economic interest
in future payments made by GSK for earlier-stage programs partnered with
Theravance BioPharma, Inc., including the closed triple combination
therapy for Chronic Obstructive Pulmonary Disease (COPD). For more
information, please visit Innoviva's website at www.inva.com.
ANORO®, RELVAR®, BREO® and ELLIPTA® are trademarks of the
GlaxoSmithKline group of companies.
Cautionary Note on Forward-Looking Statements
To the extent that statements contained in this press release are not
descriptions of historical facts, they are forward-looking statements
reflecting the current beliefs and expectations of management made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995, as amended. Forward-looking statements
include any statements regarding Innoviva's anticipated use of proceeds,
its expected cost-savings and operating expenses, and any other
statements containing the words "anticipate," "believe," "estimate,"
"expect," "intend," "may," "plan," "predict," "project," "target,"
"potential," "will," "would," "could," "should," "continue," and similar
expressions. Such forward-looking statements involve substantial risks
and uncertainties that could cause the Company's future results,
performance or achievements to differ significantly from those expressed
or implied by the forward-looking statements. The Company undertakes no
obligation to update or revise any forward-looking statements.
Forward-looking statements should not be relied upon as representing the
Company's views as of any date subsequent to the date hereof. For a
further description of the risks and uncertainties that could cause
actual results to differ from those expressed in these forward-looking
statements, as well as risks relating to the Company's business in
general, see the "Risk Factors" section of the Company's Quarterly
Report on Form 10-Q filed with the Securities and Exchange Commission
("SEC") on Form 10-K for the year ended December 31, 2016 and Innoviva's
Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, which
are on file with the SEC and available on the SEC's website at www.sec.gov.
In addition to the risks described above and in Innoviva's other filings
with the SEC, other unknown or unpredictable factors also could affect
Innoviva's results. Past performance is not necessarily indicative of
future results. No forward-looking statements can be guaranteed and
actual results may differ materially from such statements. Given these
uncertainties, you should not place undue reliance on these
forward-looking statements. The information in this press release is
provided only as of the date hereof, and Innoviva assumes no obligation
to update its forward-looking statements on account of new information,
future events or otherwise, except as required by law.
View source version on businesswire.com: http://www.businesswire.com/news/home/20170821005190/en/
Innoviva, Inc.
Eric d'Esparbes, 650-238-9640
Senior Vice
President and Chief Financial Officer
investor.relations@inva.com
Source: Innoviva, Inc.
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