Invacare Corp. (NYSE:IVC) has purchased nearly $143 million in high-yield senior notes as the home healthcare equipment maker continues to reduce its debt load.
The Elyria, Ohio-based company sweetened its deal for note holders by paying $1,075 for every $1,000 note, according to a statement from the company.
The move is part of Invacare’s strategy to rid itself of high-cost debt in order to free up cash for acquisitions. In 2008, uncertainty posed by a worldwide financial crisis and the first rumblings of U.S. healthcare reform caused Invacare to stop acquiring.
A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
Now that it’s successfully paid down some debt, Invacare will take a closer look at acquisition targets — it just isn’t sure when it’ll be ready to pull the trigger, Gerald Blouch, Invacare’s interim CEO, said last week while discussing the company’s third-quarter earnings.
“Since much of the market, particularly outside the United States, is dependent on government spending, I’d say there’s a fair amount of uncertainty, right now,” he said.
The company issued $175 million-worth of the notes, which pay 9.75 percent interest each year, in early 2007 as part of a $710 million debt refinancing. At the time, Invacare was doing its second wave of job cuts and plant closures in an effort to regain its financial footing.
