Dexcom Inc. (NSDQ:DXCM) yesterday priced a $350 million debt offering, adding $50 million to the private placement it expects to close May 12.
The offering, of 0.75% convertible senior notes, mature in May 2022 and can be redeemed for DXCM stock in February of that year. San Diego-based DexCom said the conversion rate is about 10.1 shares per $1,000 worth of notes, which equates to a conversion price of $99.09, for a 35% premium on yesterday’s $73.40-per-share closing price.
The offering, which includes a $50 million over-allotment option, is expected to deliver $340.4 million that DexCom plans to use to pay down a $75 million debt from its credit line and to fund the construction of its plant in Arizona.
“DexCom may also use the net proceeds to expand its current business through in-licensing or acquisitions of, or investments in, other businesses, products or technologies; however, DexCom does not have any commitments with respect to any such acquisitions or investments at this time,” the company said.
DexCom last week missed expectations on Wall Street with its 1st quarter results, posting losses of -$41.7 million, or -49¢ per share, on sales of $142.3 million. Losses widened by 117.2% on sales growth of 22.5% compared with Q1 2016. Analysts on The Street were looking for losses of -48¢ on sales of $144.5 million.
During a May 2 conference call with analysts, DexCom officials said they still expect to post annual sales of $710 million to $740 million this year, for top-line growth of 25% to 30%.
