Culver City-based NantHealth Inc. on April 14 announced a $137 million financing package that will be provided by two of the company's existing investors.
New York-based Highbridge Capital Management and Culver City-based Nant Capital have agreed to provide financing through convertible notes due in 2026. Nant Capital is controlled by billionaire Patrick Soon-Shiong, who is also NantHealth’s majority shareholder.
NantHealth, a member of Soon-Shiong’s NantWorks group of companies, provides data analytics and technology platforms to physician groups, insurers and pharmaceutical companies, with the aim of improving clinical decisions and patient outcomes.
The company plans to use some of the money as a refinancing of existing debt notes due in December. The rest will be invested in initiatives to grow the business, including the unit resulting from last July’s acquisition of Morrisville, N.C.-based OpenNMS Group Inc., an open-source network management company.
In addition to the financing package, Highbridge Capital and Cambridge Equities – also an affiliate owned by Soon-Shiong – each agreed to convert $5 million of their holdings of the 2021 notes to shares of NantHealth common stock on April 14, 2021.
“This transaction provides several immediate benefits to NantHealth, including enhancing our financial flexibility and funding our growth initiatives,” Ron Louks, NantHealth’s chief operating officer, said in the announcement. “Not only does this financing address the upcoming maturity of our 2021 notes, but importantly provides us with the resources to invest in our established businesses, NaviNet and Eviti, and accelerate the expansion of our recently acquired OpenNMS business. We thank our financing partners, Highbridge and Nant Capital, for their continued support,” Louks added.
Shares of NantHealth plunged 12% on April 14 to $2.60. Part of the drop may have been due to the dilution of NantHealth stock that will result from Highbridge Capital and Cambridge Equities’ conversion of debt notes to shares.
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