Acacia Pharma swaps debt for equity investment by Cosmo

Shares of Cambridge, UK-based Acacia Pharma (Euronext: ACPH) were up 7.4% at 3.21 euros by mid-morning today, after it announced an amendment to the terms of its loan agreement with Italy’s Cosmo Pharmaceuticals (SIX: COPN).

Under the terms of the amendment, the 10 million-euro ($11.1 million) loan facility that was made available on the approval of Barhemsys (amisulpride injection) is terminated and replaced with a 10 million-euro equity investment at a price of 3.112 euros per share, which represents an around 4.1% premium to the closing share price on May 29, 2020 and equates to 3,213,769 shares to be issued to Cosmo.

In addition, a further 367,893 shares are being issued to Cosmo (at an equity subscription price of 2.99 euros per share) in satisfaction of a 1 million-euro break fee payable under the terms of the loan amendment. The 25 million-euro loan facility, which will be made available by Cosmo on the approval of Byfavo (intravenous remimazolam), has not been affected by this transaction.