BioMarin to Raise Funds - Analyst Blog

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BioMarin Pharmaceutical Inc. ( BMRN ) announced that it intends to raise funds through a public offering. The company intends to offer $600 million of its senior subordinated convertible notes. The offering consists of two tranches; viz., Notes worth $300 million due in 2018 and Notes worth $300 million due in 2020. The company also intends to provide an over-allotment option to the underwriters for purchasing an additional $70 million worth of notes.

BioMarin stated in its press release that the Notes will be convertible into its common stock at a price which has not yet been determined. BioMarin intends to utilize the net proceeds from the offering for general corporate purposes, including its pipeline development. Moreover, the company intends to use some of the money to cover the cost of the capped call transactions.

The call transactions are expected to bring down the potential dilution to the company's common stock following conversion of the relevant Notes in excess of the principal amount of the converted Notes.

We note that BioMarin has an interesting pipeline with multiple pipeline related news coming up. The utilization of a portion of the funds raised through this offering will further boost the company's pipeline development efforts. The successful development and commercialization of the robust pipeline will help drive long-term growth at BioMarin, which currently has four marketed products.

BioMarin currently carries a Zacks Rank #3 (Hold). Currently, companies which look attractive include Actelion Ltd. ( ALIOF ), Isis Pharmaceuticals, Inc. ( ISIS ) and Alexion Pharmaceuticals, Inc. ( ALXN ).  Actelion and Isis carry a Zacks Rank #1 (Strong Buy), while Alexion is a Zacks #2 Ranked (Buy) stock.



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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: ALIOF , ALXN , BMRN , ISIS

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