Cerus closed a new debt facility with MidCap Financial, providing up to $110 million. The facility consists of a 5-year term loan and an asset-backed revolving loan.
The refinancing is expected to reduce annual cash interest expense by up to $3.5 million, reflecting lower borrowing costs and an approximately $30 million reduction in outstanding term loan balance. Initial proceeds from the loan, together with cash on hand, were used to retire Cerus’ existing $65 million term loan facility with MidCap.
“This refinancing marks another important milestone in strengthening our financial foundation,” Kevin Green, chief financial officer of Cerus, said. “The flexibility and increased borrowing capacity, extended maturities and lower cost of capital provide us with greater financial optionality to support sustainable growth, improve our bottom line and execute our long-term strategic priorities.”
The initial $35 million tranche was funded at closing, with up to an additional $30 million available in $5 million increments over the term of the facility. Amortization of the term loan is deferred for 48 months, followed by 12 months of straight line amortization. The facility may be prepaid at any time in increments of $5 million. In addition, Cerus entered into a new, five-year revolving loan agreement up to $45 million, which provides improved terms, increased capacity and enhanced flexibility to support anticipated growth of the global commercial business.
