JWCA advises Accelerate Diagnostics on the equitization of its convertible notes

September 2021 | read press release

Transaction Background

Accelerate Diagnostics, Inc (“Accelerate” or the “Company”) had $171.5mm convertible debt maturing in 2023. The low bond price presented an opportunity to retire a portion of 2023 debt early by delivering stock, which allowed Accelerate to quickly and efficiently de-lever the balance sheet and address financing overhang

Accelerate Diagnostics’ objectives included:

• De-lever: retire the convertible to lower debt balance and interest expense

• Use stock as the consideration to preserve cash

• Minimize transaction and friction costs; execute as efficiently as possible

JWCA acted as exchange agent for the transaction and provided analysis and advice around:

• Evaluate tactics around investor targeting and execution method

• Balancing exchange considerations to minimize repurchase price and friction costs

• Investor outreach, negotiation, and execution of exchanges

Results

The Company executed a successful liability management transaction for its 2.50% convertible notes due 2023:

• Exchanged $51mm of their convertible notes for stock (~30% of outstanding)

• Saved an estimated $1.9 million of cash interest over the remaining life

• Minimal stock selling: the majority of the shares delivered to investors were long-only investors