Mesoblast and Oaktree Capital Enter Into Refinancing and Expansion of Senior Debt Facility
NEW YORK, Nov. 21, 2021 (GLOBE NEWSWIRE) -- Mesoblast Limited (Nasdaq:MESO; ASX:MSB), global leader in allogeneic cellular medicines for inflammatory diseases, today announced that it has successfully refinanced its existing senior debt facility with a new US$90 million five year facility provided by funds managed by Oaktree Capital Management, L.P. (“Oaktree”).
Mesoblast drew the first tranche of US$60 million on closing, with proceeds being used to repay the outstanding balance of the existing senior debt facility with Hercules Capital, Inc. Up to an additional US$30 million may be drawn on or before December 31, 2022, subject to certain milestones. The facility has a three-year interest only period, at a rate of 9.75% per annum, after which time 40% of the principal amortizes over two years and a final payment due November 2026. Oaktree will also receive warrants to purchase 1,769,669 American Depositary Shares (ADSs)1 at US$7.26 per ADS, a 15% premium to the 30-day VWAP. The warrants may be exercised within 7 years of issuance.
“We are pleased to have leading global investment management firm Oaktree as our new financing partner as we focus on bringing our first product to the US market. Oaktree has a demonstrated partnership approach to innovative companies, making it an excellent fit to support Mesoblast’s commercial growth strategy over the next five years,” said Silviu Itescu, Chief Executive of Mesoblast.
Aman Kumar, Co-Portfolio Manager of Life Sciences Lending at Oaktree said, “We are delighted to partner with Mesoblast at this point in its development. We recognize the quality of the portfolio and the significant near-term milestones that could help the company successfully commercialize its first product in the US.”
Cantor Fitzgerald & Co. acted as exclusive arranger and financial advisor to Mesoblast in this transaction.
Mesoblast has a strong and extensive global intellectual property portfolio with protection extending through to at least 2041 in all major markets. The Company’s proprietary manufacturing processes yield industrial-scale, cryopreserved, off-the-shelf, cellular medicines. These cell therapies, with defined pharmaceutical release criteria, are planned to be readily available to patients worldwide.
Mesoblast is developing product candidates for distinct indications based on its remestemcel-L and rexlemestrocel-L stromal cell technology platforms. Remestemcel-L is being developed for inflammatory diseases in children and adults including steroid refractory acute graft versus host disease and moderate to severe acute respiratory distress syndrome. Rexlemestrocel-L is in development for advanced chronic heart failure and chronic low back pain. Two products have been commercialized in Japan and Europe by Mesoblast’s licensee, and the Company has established commercial partnerships in Europe and China for certain Phase 3 assets.
Mesoblast has locations in Australia, the United States and Singapore and is listed on the Australian Securities Exchange (MSB) and on the Nasdaq (MESO). For more information, please see www.mesoblast.com, LinkedIn: Mesoblast Limited and Twitter: @Mesoblast
Release authorized by the Chief Executive.
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1 The warrants will be issued under a prospectus to be lodged with ASIC under which the warrants will be offered to Oaktree. The agreement to issue the warrants is subject to approval of Mesoblast shareholders if required at the time of issue for the purposes of the 15% placement limit in Listing Rule 7.1.
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