Mesoblast (ASX:MSB) refinances debt facility with Oaktree

Company News

by Lauren Evans

Regenerative medicine developer Mesoblast (ASX:MSB) has agreed to a US$90 million debt facility with US fund manager Oaktree Capital Management to pay off an existing debt facility and to help the company expand in the US.

Mesoblast drew the first tranche of US $60 million, with proceeds being used to repay the outstanding balance of the existing senior debt facility with Hercules Capital. The remaining US$30 million may be drawn on or before December 31.

The facility has a three-year interest only period at a rate of 9.75 per cent per annum, after which time 40 per cent of the principal will be amortised over two years and a final payment due November 2026. The deal also delivers Oaktree warrants to purchase around 1.8 billion American depositary shares (ADS) at US$7.26 per ADS within 7 years of issuance.

“We are pleased to have leading global investment management firm Oaktree as our new financing partner as we focus on bringing our first product to the US market," said Mesoblast CEO Silviu Itescu.

Shares in Mesoblast (ASX:MSB) are trading 1.7 per cent lower at $1.69. 

Are you a 708 sophisticated investor?

A sophisticated investor is defined under Section 708 of the Corporations Act (net assets of $2.5 million or annual incomes in excess of $250,000).

They are eligible to receive information regarding wholesale investment opportunities that are not available to regular or retail investors.

Please subscribe if you would like to be alerted to these types of opportunities.