SALT LAKE CITY - Varex Imaging (NASDAQ:VREX) Corporation (NASDAQ:VREX), a medical imaging component manufacturer with a market capitalization of $634 million, today announced the initiation of a private offering of $125 million in senior secured notes due October 15, 2027. The offering is contingent on market conditions and other factors. These notes will be an additional issuance of the company's existing 7.875% senior secured notes, which were first issued on September 30, 2020, in the amount of $300 million. Currently, $243 million of these notes remain outstanding.
The company plans to allocate the net proceeds from this offering towards the partial repayment of its outstanding Convertible Notes, which are due in June 2025. Varex may also use the funds to repurchase a portion of the Convertible Notes before they reach maturity. According to InvestingPro data, the company currently maintains total debt of $476.7 million, with several analysts expecting improved profitability in the coming year. InvestingPro subscribers have access to detailed debt analysis and 6 additional key insights about VREX's financial health.
Varex's new notes will be guaranteed by both its existing and future domestic subsidiaries, as well as certain foreign subsidiaries. These guarantees are on a senior secured basis, in line with the guarantees for Varex's Revolving Credit Facility. The security for the notes includes a first priority interest in specific equipment, capital stock, intellectual property, and select real property of the company and its guarantors. Additionally, there is a second-priority lien on inventory, accounts receivable, cash, accounts, intercompany loans, and certain real property, subordinate to the liens securing the Revolving Credit Facility obligations.
The offering is targeted at qualified institutional buyers according to Rule 144A under the Securities Act and non-U.S. persons in compliance with Regulation S. The notes, which will not be registered under the Securities Act of 1933 or any state securities laws, will be subject to restrictions on transfer and resale unless they are registered or exempt from registration under these laws.
Varex Imaging Corporation specializes in the design and manufacture of X-ray imaging components, such as X-ray tubes and digital detectors, which are integral to medical, industrial, and security imaging systems. With annual revenue of $811 million and a strong liquidity position evidenced by a current ratio of 3.32, the company maintains a solid market presence despite recent profitability challenges. Employing approximately 2,300 individuals globally, Varex is headquartered in Salt Lake City, Utah. For comprehensive analysis including Fair Value estimates and detailed financial metrics, investors can access the full company research report on InvestingPro, which is part of their coverage of over 1,400 US equities.
This announcement is based on a press release statement and does not constitute an offer to sell or a solicitation to buy the notes or any other securities. It should not be considered a sale of the notes or any other securities in jurisdictions where such an offer, solicitation, or sale would be illegal. The information provided is current as of the date of the release and may not be updated by the company in the future.
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