Cryoport Announces $200 Million Repurchase Program and the Repurchase of $160 Million of Convertible Senior Notes

Rhea-AI Summary

Cryoport announced a $200 million repurchase program for common stock and convertible senior notes, effective until December 31, 2027. The company also agreed to repurchase $160 million of its 0.75% Convertible Senior Notes due in 2026 at an 11.5% discount, valued at $141.6 million plus accrued interest. This strategic move aims to reduce the outstanding debt to approximately $186.2 million, down from an initial $402.5 million. The transactions are expected to close on August 9, 2024, subject to customary closing conditions. CEO Jerrell Shelton emphasized the company's strong cash position, which enables debt reduction while maintaining liquidity for long-term growth.

Positive

• Authorized a $200 million repurchase program for common stock and convertible notes.
• Repurchased $160 million of 0.75% Convertible Senior Notes at an 11.5% discount.
• Outstanding debt reduced to approximately $186.2 million from an initial $402.5 million.

Negative

• None.

Insights

Financial Analyst

Cryoport's $200 million repurchase program and $160 million convertible note repurchase are strategically significant moves. The company is leveraging its strong cash position to reduce debt, potentially improving its financial health. The 11.5% discount on the note repurchase is a favorable deal, effectively saving $18.4 million.

This action reduces the principal balance of the 2026 Notes from $402.5 million to $186.2 million, a 53.7% reduction. This substantial decrease in debt could lead to lower interest expenses and improved financial flexibility. However, investors should note that this uses a significant portion of cash reserves, which could impact future growth investments.

Market Research Analyst

Cryoport's repurchase program signals confidence in its financial position and potentially undervalued stock. The flexibility to repurchase both common stock and convertible notes until 2027 gives the company strategic options to manage its capital structure.

The move to reduce convertible debt is particularly noteworthy. It decreases the potential for future stock dilution, which is often a concern with convertible notes. This could be viewed positively by existing shareholders. However, the market's reaction will depend on how investors perceive the trade-off between debt reduction and the use of cash that could have been invested in growth initiatives.

Supply Chain Expert

As a global leader in life sciences supply chain solutions, Cryoport's financial maneuvers reflect its strong market position. The company's ability to execute such a significant debt repurchase suggests robust cash flows from its operations. This financial strength could translate into competitive advantages in the specialized logistics market.

The move to strengthen the balance sheet while maintaining "considerable liquidity" for growth plans indicates a balanced approach to financial management and expansion. This could position Cryoport well for potential market share gains or strategic acquisitions in the evolving life sciences supply chain sector.

• $200 million repurchase program authorized to repurchase common stock and/or convertible notes
  
  
• Repurchasing approximately $160 million of 0.75% Senior Notes due in 2026 at an 11.5% discount to par value
  
  
• Principal balance reduced to approximately $186.2 million

NASHVILLE, Tenn., Aug. 6, 2024 /PRNewswire/ -- Cryoport, Inc. (Nasdaq: CYRX) ("Cryoport" or the "Company"), a global leader in supply chain solutions for the life sciences, today announced that the Company's Board of Directors had authorized a repurchase program to purchase up to $200 million of the Company's common stock and/or convertible senior notes (the "2024 Repurchase Program").  The 2024 Repurchase Program became effective on August 1, 2024 and remains in effect through December 31, 2027. 

The Company also announced that it has entered into agreements with certain holders of its 0.75% Convertible Senior Notes due in 2026 (the "2026 Notes") to repurchase $160 million in aggregate principal amount of the 2026 Notes (the "Transactions") for an aggregate repurchase price of $141.6 million, plus accrued and unpaid interest.  The Transactions were made under the 2024 Repurchase Program.

Jerrell Shelton, CEO of Cryoport, commented, "We are pleased to complete this opportunistic repurchase of our 2026 Notes. With our strong cash position, we are in a position to reduce our outstanding debt and further strengthen our balance sheet, while also maintaining considerable liquidity to support our long-term growth plans."

The Transactions are expected to close on August 9, 2024, subject to the satisfaction of customary closing conditions. Following such closings, approximately $186.2 million principal amount of the 2026 Notes will remain outstanding, from an initial issued principal balance of $402.5 million.

This press release does not constitute an offer to sell or a solicitation of an offer to buy these securities, nor shall there be any offer or sale of these securities in any state or jurisdiction in which the offer, solicitation, or sale would be unlawful prior to the registration or qualification thereof under the securities laws of any such state or jurisdiction.

About Cryoport, Inc
Cryoport, Inc. (Nasdaq: CYRX), is a global leader in supply chain solutions for the Life Sciences with an emphasis on cell & gene therapies. Cryoport enables manufacturers, contract manufacturers (CDMO's), contract research organizations (CRO's), developers, and researchers to carry out their respective business with products and services that are designed to derisk services and products and provide certainty. We provide a broad array of supply chain solutions for the life sciences industry. Through our platform of critical products and solutions including advanced temperature-controlled packaging, informatics, specialized bio-logistics services, bio-storage, bio-services, and cryogenic systems, we are "Enabling the Future of Medicine™" worldwide, through our innovative systems, compliant procedures, and agile approach to superior supply chain management.

Our corporate headquarters, located in Nashville, Tennessee, is complemented by over 50 global locations in 17 countries, with key sites in the United States, United Kingdom, France, the Netherlands, Belgium, Portugal, Germany, Japan, Australia, India, and China.

For more information, visit www.cryoportinc.com or follow via LinkedIn at https://www.linkedin.com/company/cryoportinc or @cryoport on X, formerly known as Twitter at www.x.com/cryoport for live updates.

Forward-Looking Statements
Statements in this press release which are not purely historical, including statements regarding Cryoport's intentions, hopes, beliefs, expectations, representations, projections, plans or predictions of the future, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, those related to the amount of 2026 Notes to be repurchased and the timing of completion of the repurchases. Factors that could cause actual results to differ materially include, but are not limited to, risks and uncertainties associated with the effect of changing economic and geopolitical conditions; changes in the convertible note and other capital markets; and other factors discussed in Cryoport's SEC reports, including in the "Risk Factors" section of its most recently filed periodic reports on Form 10-K and Form 10-Q, as well as in its subsequent filings with the SEC. The forward-looking statements contained in this press release speak only as of the date hereof and Cryoport cautions investors not to place undue reliance on these forward-looking statements. Except as required by law, Cryoport disclaims any obligation, and does not undertake to update or revise any forward-looking statements in this press release.

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SOURCE Cryoport, Inc.

FAQ

What did Cryoport announce in its recent press release?

Cryoport announced a $200 million repurchase program for common stock and convertible senior notes, along with the repurchase of $160 million in 0.75% Convertible Senior Notes due in 2026.

How much of its Convertible Senior Notes is Cryoport repurchasing?

Cryoport is repurchasing $160 million of its 0.75% Convertible Senior Notes due in 2026.

What is the discount rate Cryoport achieved on the repurchase of its 2026 Convertible Senior Notes?

Cryoport achieved an 11.5% discount on the repurchase of its 0.75% Convertible Senior Notes due in 2026.

What will be the outstanding principal amount of Cryoport's 2026 Convertible Senior Notes after the repurchase?

The outstanding principal amount will be approximately $186.2 million.

When is the expected closing date for Cryoport's repurchase transactions?

The transactions are expected to close on August 9, 2024.