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Novanta Inc. (NASDAQ:NOVT) ("Novanta" or the "Company"), a trusted technology partner to medical and advanced technology equipment manufacturers, announced today that it has priced its previously announced public offering of 11 million of its 6.50% tangible equity units at $50.00 per unit (equal to the stated amount per unit). The transaction is a public offering made by means of a prospectus supplement under Novanta's effective shelf registration statement. Novanta's common shares are quoted on Nasdaq under the ticker symbol "NOVT," and Novanta has applied to list the tangible equity units on Nasdaq under the symbol "NOVTU." Novanta anticipates that the offering will close on November 12, 2025, subject to customary closing conditions.
Novanta has granted the underwriters of the offering a 30-day option to purchase up to an additional 1,650,000 tangible equity units, solely to cover over-allotments, if any.
Each tangible equity unit is comprised of a prepaid stock purchase contract and a senior amortizing note due 2028, each issued by Novanta. Unless settled earlier, each purchase contract will automatically settle on November 1, 2028 (subject to postponement in certain limited circumstances), and Novanta will deliver at least 0.3729, but no more than 0.4662, of its common shares per purchase contract, subject to adjustment, based upon the applicable market value of the common shares, as described in the final prospectus supplement relating to the tangible equity units offering. The threshold appreciation price for each tangible equity unit, which represents the stated amount of each tangible equity unit divided by the minimum settlement rate of 0.3729, is initially $134.0842 and represents an approximately 25.0% appreciation over the closing price for Novanta's common shares on Nasdaq on November 6, 2025.
Each amortizing note will have an initial principal amount of $8.74, will bear interest at a rate of 6.30% per annum and will have a final installment payment date of November 1, 2028. On each of February 1, May 1, August 1 and November 1, commencing on February 1, 2026, Novanta will pay equal quarterly cash installments of $0.8125 per amortizing note (except for the February 1, 2026 installment payment, which will be $0.7132 per amortizing note), which will constitute a payment of interest and a partial repayment of principal, and which cash payment in the aggregate per year will be equivalent to 6.50% per year with respect to each $50.00 stated amount of tangible equity units. The amortizing notes will be the direct, unsecured and unsubordinated obligations of Novanta.
Novanta expects the net proceeds from the offering to be $533.0 million (or up to approximately $613.2 million if the underwriters exercise their over-allotment option to purchase additional tangible equity units) after deducting the underwriting commissions and estimated offering expenses. Novanta expects to use the net proceeds from the offering to strengthen the balance sheet and enhance strategic flexibility, which may include funding working capital and potential future acquisitions and investments, as well as capital expenditures, share repurchases, and other general corporate purposes. Pending use of the net proceeds from the offering described above, Novanta intends to use a portion of the net proceeds to repay approximately $317 million of indebtedness under its revolving credit facility.
Posted In: NOVT
