JWCA ADVISES Immunogen ON an exchange of their 4.50% convertible notes due 2021 into common equity

September 2017 | read press release

Transaction Background

Following the issuance of ImmunoGen’s $100mm convertible issuance in 2016, several positive milestones in drug development led to a ~140% increase in stock price.  The high stock price presented an opportunity to retire the debt early by delivering a minimal number of shares in excess of the original conversion rate, since deep in-the-money convertible bonds have low “option value” for investors

• Evaluated all aspects of transaction in detail for ImmunoGen, including potential stock price impact and future coupon savings
• Leveraged deep relationships with investors to execute transaction in a two day over-the-wall process
• Structured transaction to mitigate impact of equity sales on transaction terms, including  by using a 4-day averaging period to help determine pricing

Results

The Company executed a successful liability management transaction for its 4.50% convertible notes due 2021:

• Exchanged majority of their 4.50% convertible senior notes due 2021 for approximately 23 million shares
• Issuance of ~23 million shares will increase IMGN float and improve trading liquidity
• Retires $96.9 million principal amount of debt and saves an estimated $15.5 million of cash interest over the remaining life