RadNet Inc. has raised a sizable amount of funds through a public stock offering, the company announced on Tuesday.
The imaging center operator has sold a total of 7,575,000 in shares of its common stock at $29.75 apiece. Leaders said the offering raised roughly $225 million in gross proceeds, before deducting underwriting discounts, commissions and other expenses.
“RadNet intends to use the net proceeds from the proposed offering to pay down $100 million of its first lien term loans and for working capital and general corporate purposes,” the Los Angeles-based company said in a June 13 announcement.
In addition, RadNet offered its underwriters a 30-day option to purchase up to 1,136,250 more shares of common stock at the public offering price. The company officially closed the deal on Tuesday night, following the initial announcement. RadNet had initially sought $175 million but upped the amount after overwhelming interest.
The loan in question has an aggregate principal amount of about $725 million, according to a filing with the SEC. As of March 31, $712 million of the total is slated to mature on April 23, 2028, carrying an interest rate of 7.81%.
RadNet operates a total of 363 imaging centers in Arizona, California, Delaware, Florida, Maryland, New Jersey and New York. The company employs more than 750 radiologists in its contracted radiology groups, with over 9,000 total employees. RadNet also has a software arm called eRad, which it said is “integral” to its imaging center business, selling computerized systems for distributing, displaying, storing and retrieving files.
Investment banks Raymond James and Jefferies are jointly underwriting the deal, pooling together their resources to share in the profit and risk. A second group of banks taking part in the deal includes Barclays, Truist Securities, RBC Capital Markets and TD Securities.
RadNet saw its shares slide 8.22% Tuesday in after-hours trading following news of the offering.
The company’s chief financial officer spoke at the Jefferies Healthcare Conference on June 8 ahead of the deal.
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.