AtheroGenics extends maturity profile by restructuring $17.5 million of 4.5% convertibles

By Angela McDaniels

Tacoma, Wash., Jan. 9 - AtheroGenics, Inc. said it exchanged $17.5 million of its 4.5% convertible subordinated debentures due Aug. 15, 2008 for $5.5 million in cash and $11.5 million of 4.5% convertible notes due March 1, 2011.

Other than the 2011 maturity date, the terms of the newly issued notes are identical to the terms of the 2008 notes, including a conversion price of $15.34 per share.

Following this transaction, $30.5 million of the 2008 convertibles remain outstanding. The company issued $100 million of the convertibles in 2003.

"This restructuring represents another opportunistic financial transaction that will reduce our short-term cash needs and provide us with greater financial flexibility," Mark P. Colonnese, executive vice president of commercial operations and chief financial officer, said in a company news release.

"Over the last few years, we have welcomed opportunities to restructure this debt on terms that provide benefits to the noteholders and minimize dilution to our current equity holders."

In June 2007, the company issued $60.4 million of the 2011 convertibles in exchange for $38 million of the 2008 convertibles.

Atlanta-based AtheroGenics develops drugs for the treatment of chronic inflammatory diseases.

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