MannKind Corporation on Wednesday announced that it has requested a final loan disbursement of $30.1 million from the Mann Group.
The Valencia biotech company has been under a revolving credit agreement with the Mann Group since 2010. At the time, the group was controlled by then MannKind Chief Executive Alfred Mann, who died last year.
After the requested payout, MannKind will owe Mann Group $79.7 million, which will be due in 2020. MannKind said $10.6 million from the funds received will be used to pay back interest to the Mann Group from previous loans.
MannKind is also in a financial agreement with investor Deerfield Management Co. Under that agreement, MannKind is forbidden to draw from the Mann Group until financial obligations to Deerfield are met. However, the company stated that the agreement allows withdrawal of funds if it is used for interest payments.
“This advance will meaningfully increase our cash on hand as we continue to explore potential opportunities to enhance our capital structure,” MannKind Chief Executive Michael Castagna said in a statement.
Castagna became chief executive less than a month ago; he was previously chief marketing officer. Castagna also mentioned that the company has engaged Greenhill & Co. as a new financial and strategic advisor.
Shares of MannKind (MKND) on Wednesday closed down 1 cent, or less than a percent, at $1.55 on the Nasdaq.