ATEC Prices Upsized $350.0 Million Convertible Senior Notes Offering

Alphatec Holdings, Inc. (Nasdaq: ATEC), a provider of innovative solutions dedicated to revolutionizing the approach to spine surgery, has priced an upsized offering of $350.0 million convertible senior notes due 2030. The offering was initially announced at $300.0 million but was increased due to strong investor demand. The notes will have an interest rate of 0.75% per annum, payable semi-annually in arrears, and will mature on March 15, 2026, unless earlier repurchased, redeemed, or converted.



The notes will be senior, unsecured obligations of ATEC and will be convertible into cash, shares of ATEC's common stock, or a combination of both, at ATEC's election, subject to certain restrictions. The initial conversion rate is 100% of the principal amount of the notes, which means that each $1,000 note can be converted into 100 shares of ATEC's common stock. The notes will be redeemable, in whole or in part, at ATEC's option, on or after March 20, 2023, and on or before the 60th scheduled trading day immediately before the maturity date, but only if the last reported sale price per share of ATEC's common stock exceeds 130% of the conversion price for a specified period of time and certain other conditions are satisfied.

ATEC expects to use the net proceeds from the offering for general corporate purposes, which may include working capital, capital expenditures, and other general corporate purposes. The offering is expected to close on or about March 10, 2025, subject to customary closing conditions.



The pricing of the notes reflects the current market conditions and investor sentiment towards ATEC and the broader healthcare sector. The low interest rate of 0.75% per annum indicates that investors are willing to accept a lower return on their investment, suggesting a positive sentiment towards ATEC and the healthcare sector as a whole. The conversion price of the notes is $7.85 per share, which is slightly below the current stock price of ATEC, indicating investor optimism about the company's future prospects. The upsized offering size, from $300.0 million to $350.0 million, indicates strong investor demand for the notes, reflecting confidence in ATEC's financial health and growth prospects, as well as the broader healthcare sector.

In conclusion, ATEC's upsized offering of $350.0 million convertible senior notes reflects the strong investor demand for the company's securities and the positive sentiment towards the broader healthcare sector. The low interest rate, conversion price, and upsized offering size all indicate a positive outlook for ATEC and the healthcare sector as a whole.