GENFIT Initiates Amendments to 2025 OCEANEs Terms
Recently, GENFIT has taken steps to amend the terms concerning the 2025 OCEANEs (Obligations à option de conversion et d'échange en actions nouvelles ou existantes), a move set to benefit bondholders significantly.
Key Proposals for Bondholders
The biopharmaceutical company, GENFIT (NASDAQ and Euronext: GNFT), intends to present two main proposals to the holders of the 2025 OCEANEs:
- To repurchase the 2025 OCEANEs at a price of EUR 32.75 per bond from those interested in selling their bonds.
- The alternative involves a consent fee of EUR 0.90 for each bond that remains outstanding even after the bondholder meeting.
Context of the Proposal
This proposal comes on the heels of a significant financing announcement. On January 30, 2025, GENFIT revealed a royalty financing agreement with HealthCare Royalty (HCRx), potentially unlocking up to EUR 185 million. This financing is aimed at extending GENFIT's operational runway, especially as they navigate the repayment of their OCEANEs maturing in October 2025.
Royalty Financing Arrangement
As part of the royalty financing arrangement, GENFIT will be compensated through royalties from sales of their drug, Iqirvo® (elafibranor), establishing a strategic partnership with Ipsen. To meet obligations under this agreement, GENFIT will assign royalty receivables to a trust, ensuring that holders of the royalty financing bonds are secured.
Amendment of Terms Conditions
A crucial aspect of this proposed transaction involves an amendment to the existing negative pledge clause associated with the 2025 OCEANEs. This clause limits GENFIT in granting security interests over its current or future assets. Approval from the bondholders is required for the proposed amendments to proceed.
Dual Proposal and Next Steps
Following consultations with the bondholders through its solicitation advisor, Natixis, GENFIT is finalizing the definitive terms for the proposal. The updated terms will include the repurchase option and consent fee options, which are contingent upon bondholder approval and the closing of the royalty financing deal.
Details for Bondholders
Eligible bondholders interested in selling their bonds are encouraged to reach out via GENFIT's investor relations contact, as well as through their usual channels at Natixis. The consent fee will be offered only after the successful execution of the repurchase.
Company Overview
GENFIT is dedicated to advancing treatments for patients suffering from severe liver diseases, leveraging over two decades of research to develop innovative therapeutic and diagnostic solutions. The company’s current pipeline includes multiple promising candidates aimed at various liver complications. Moreover, GENFIT’s commitment is reflected in Iqirvo®'s accelerated approval by multiple regulatory bodies, emphasizing their robust clinical development capabilities.
Company Contact Information
For further inquiries, GENFIT can be contacted via their investor relations email or by reaching out to relevant teams for both qualified and retail investors.
Frequently Asked Questions
What is GENFIT proposing to holders of the 2025 OCEANEs?
GENFIT is proposing to either repurchase the 2025 OCEANEs at EUR 32.75 or provide a consent fee of EUR 0.90 for outstanding bonds.
Why is GENFIT making these proposals now?
The proposals follow a recent royalty financing agreement that aims to strengthen the company's financial position and extend its cash runway.
How does the royalty financing work?
GENFIT will receive payments based on royalties from sales of Iqirvo® and will assign corresponding receivables to a trust for bondholder security.
What is the significance of the negative pledge clause?
This clause limits GENFIT's ability to secure its assets for financing, necessitating a bondholder amendment for the royalty financing to proceed.
How can bondholders participate in the proposal?
Bondholders are encouraged to contact GENFIT or Natixis for further details about the repurchase or consent fee engagement.
