SYDNEY, July 31, 2018 (Newswire.com) – Parnell Pharmaceuticals Holdings Ltd. (OTC PINK: PARNF) (“Parnell” or the “Company”), a fully integrated pharmaceutical company focused on developing, manufacturing and commercializing innovative animal and human health solutions, today announced it has entered into a credit agreement with affiliated entities of New York-headquartered Marathon Asset Management (“Marathon”). Parnell will use the proceeds from this transaction to refinance its current outstanding debt, pay transaction expenses and provide for working and growth capital.
Upon the closing of this financing with Marathon, Parnell received US$32.0 million (~AU$43.24 million) of a senior secured single draw, six-year term loan. The refinancing allows for an interest-only payment period of 24 months, permitting Parnell to defer the first monthly payment of principal until August 2020. Marathon will also receive a detached, synthetic revenue stream of 5% of the higher of management’s current projections or actual sales of Parnell’s US bovine drugs (estroPLAN and GONAbreed) from 2020-2026. Synthetic revenue payments will be capped subject to Parnell hitting certain pre-specified EBITDA targets.
“There is a global dearth of FDA-approved, sterile, injectable manufacturing facilities, catering to both the animal and human markets. Parnell’s contract manufacturing (CMO) division has won new contracts and continues to deliver on its existing commitments. The US Production business has shown considerable strength over the last few years. As such, Marathon is pleased to provide Parnell with debt capital so that the Company can utilize the proceeds to refinance existing indebtedness, improve its working capital position and scale the operations,” stated Evan Bedil, Managing Director of Marathon.
“Having previously stated an intention to better align our debt cost and maturity with our improved business performance, our Board of Directors is very pleased to announce this transaction today,” said Brad McCarthy, Chief Executive Officer of Parnell, who added, “In Marathon, we now have a major global market player funding our ongoing rapid growth trajectory. Reaching agreement with such a pre-eminent debt capital group recognizes and validates the great strides that our company is now making and gives us further confidence in our strategic direction. I am very pleased to be partnering with Evan and his team as we continue to deliver on these objectives,” Mr. McCarthy concluded.
Marathon Asset Management is a New York-based global investment advisor with approximately $14.5 billion of capital under management. The firm was founded in 1998 by Louis Hanover and Bruce Richards and employs more than 150 professionals. Marathon is headquartered in New York City, and it has international offices in London and Singapore. Marathon is a Registered Investment Adviser with the Securities and Exchange Commission. For more information, please visit www.marathonfund.com. For more information about this transaction, please contact Andrew Rabinowitz at 212-500-3050.
Parnell (OTC: PARNF) is a fully integrated pharmaceutical company focused on developing, manufacturing and commercializing innovative animal and human health solutions. Parnell is a technology and clinical science leader in dairy reproduction, marketing its proprietary brands estroPLAN and GONAbreed via its dedicated sales force and digital technology mySYNCH in the USA and Australia-New Zealand, and via distributors in other markets. Parnell has a rapidly growing contract manufacturing business supplying industry majors with specialized sterile injectable products. Recently, Parnell leveraged its novel intellectual property position in the Pentosan Polysulfate drug class to address the human market through a new contract with a major global human health company. In companion animal, Parnell manufactures and markets its proprietary canine osteoarthritis brands Zydax and Glyde.
Source: Parnell Pharmaceuticals Holdings Ltd