Insulet Corp. (NSDQ:PODD) paid off a $60 million credit facility with Deerfield Partners more than nine months ahead of schedule, with a $33.3 million payment it says will save $5 million.
The Bedford, Mass.-based insulin management company took out the credit line in March 2009, drawing $27.5 million almost immediately and keeping another $32.5 million available.
Insulet re-worked the original deal in September 2009, paying off the initial loan with 2,855,659 shares of stock at $9.63 per share — a 6 percent discount from its $10.28 closing price Sept. 25, 2009. Deerfield agreed to eliminate performance-based milestones on the remaining $32.5 million, reduce the annual interest rate to 8.5 percent from 9.75 percent and forego the remaining 1.5 million warrants that would have been issued on future draws.
“We are very pleased that our recent equity financing has given us the ability to prepay our facility agreement, saving shareholders approximately $5 million in cash interest payments, while deleveraging the balance sheet,” CFO Brian Roberts said in prepared remarks.
Insulet said it will log a non-cash interest charge of roughly $8 million during the fourth quarter on debt discounts and financing costs which were being amortized as interest expenses.
Insulet Corp. amended its $60 million credit facility with Deerfield Management in a move it says will save $12 million.
PODD shares were trading at $14.80 in mid-morning activity, up 1.4 percent.