Savient Pharmaceuticals, Inc. (Nasdaq: SVNT) announced it has priced $200 million aggregate principal amount of 4.75% Convertible Senior Notes due 2018 (the "Notes") pursuant to an automatically effective registration statement filed with the Securities and Exchange Commission on January 31, 2011. In addition, Savient has granted the underwriters an option to purchase up to an additional $30 million aggregate principal amount of Notes, solely to cover over-allotments.
The Notes will be convertible, under certain circumstances and during certain periods, based on an initial conversion rate of 86.6739 shares of common stock per $1,000 principal amount of the Notes, which is equivalent to an initial conversion price of approximately $11.54 per share of common stock, subject to adjustment in certain circumstances. The initial conversion price represents a conversion premium of 25% over the last reported sale price of the common stock of $9.23 per share on January 31, 2011. Upon conversion, the Notes may be settled, at Savient's election, in cash, shares of Savient's common stock or a combination of cash and shares of Savient's common stock. Savient may redeem some or all of the Notes for cash under certain circumstances on or after February 1, 2015. The Notes will bear interest at a rate of 4.75% per year. The offering is expected to close on February 4, 2011, subject to the satisfaction of customary closing conditions.
Savient expects to use the net proceeds of the offering to commercialize KRYSTEXXA™ in the United States, including completion of its ongoing efforts to recruit a sales force, expand its marketing organization and establish a commercial infrastructure, to fund clinical development activities directed to potential label expansion for KRYSTEXXA in the United States, to further develop and seek regulatory approval for KRYSTEXXA in jurisdictions outside the United States, particularly in the European Union, and for general corporate purposes, including working capital.
J.P. Morgan Securities LLC is acting as sole book-running manager of the offering. Lazard Capital Markets LLC and Cowen and Company, LLC are acting as co-managers of the offering.
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