Angiotech will contribute to Angiotech Pharmaceutical Interventions (API) certain business assets and intellectual property, which include primarily business assets of Angiotech other than the intellectual property and royalty revenue related to the Taxus coronary stent system.
Angiotech has also entered into a note purchase agreement with Ares Management and New Leaf Venture Partners, under which the investors will purchase between $200 and $300 million, at the company’s option, of convertible notes issued by API that will be convertible into a significant minority equity interest in API.
The net proceeds from the issuance of the convertible notes will be used to reduce Angiotech’s existing debt, pursuant to tender offers announced and commenced concurrent with this announcement. The transaction is subject to approval of the company’s shareholders and other customary closing conditions.
Thomas Bailey, CFO of Angiotech, said: This transaction offers Angiotech the opportunity for meaningful reduction of debt and interest expense, and allows us to raise a total amount of proceeds greater than would have been reasonably achievable through the consolidated company’s capital alternatives.