JWCA advises Neurocrine biosciences on the repurchase of their convertible notes

Transaction Background

Neurocrine Biosciences was interested in opportunistically retiring a portion of their existing convert prior to maturity

Neurocrine’s objectives included:

Repurchase the convertible to reduce leverage, reduce interest expense, and eliminate equity dilution
Minimize transaction and friction costs; execute as efficiently as possible

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

Tactics around investor targeting and negotiation
Balancing repurchase considerations to minimize purchase price and friction costs
Designing the execution method and documentation
Outreach and execution of repurchases with convertible investors

Results

The Company executed a successful liability management transaction for its 2.25% convertible notes due 2024:

Repurchased $210.8mm of their 2.25% convertible notes (~55% of outstanding) for cash. In combination with the repurchase in November 2020, Neurocrine has now retired ~67% of the original $517.5mm convertible issuance
Repurchased ~2.8mm underlying shares and saved an estimated $9.1 million of cash interest expense over the remaining life