Advertise With UsAdvertise on our extensive network of industry websites and newsletters.
Get the PBR newsletterSign up to our free email to get all the latest PBR
news.Medical device firm Abiomed has reported a strategic investment in WorldHeart. Under the terms of the transaction, Abiomed has agreed to loan $5 million in convertible secured debt to WorldHeart, with a term of two years and bearing interest at 8% per annum.
Subscribe to our email newsletter
The loan is convertible, at Abiomed’s option, into common shares of WorldHeart at a conversion price of approximately $1.75 per share, resulting in an approximately 19.9% ownership interest in WorldHeart upon conversion. The loan is secured by all of the assets of WorldHeart, including its intellectual property. Abiomed ended its most recent fiscal quarter with $59.5 million in cash and no debt.
Additionally, the two companies have entered into a two-year marketing and clinical support services agreement through which they will seek opportunities to leverage existing expertise and resources at Abiomed and potentially provide cost savings for WorldHeart. In consideration for these support services, Abiomed will be issued a warrant for the purchase of up to 3.4 million common shares of WorldHeart.
Abiomed has also been granted a right of first refusal to distribute WorldHeart’s products, other than the Novacor LVAS product that is currently being sold by WorldHeart. Abiomed has the largest sales and clinical team in the ventricular assist device field, calling on the catheterization labs, intensive care units and heart surgery suites. In addition, Abiomed has been granted the right to designate one nominee or observer to the WorldHeart board of directors.