Business
Semtech Corporation Announces Pricing of Private Placement of $250 Million of New Convertible Senior Notes
CAMARILLO, Calif.--(BUSINESS WIRE)-- Semtech Corporation (Nasdaq: SMTC) (the “Company” or “Semtech”) today announced the pricing of $250 million in aggregate
About this update from Semtech Corporation
[{"type":"text","content":" CAMARILLO, Calif.--(BUSINESS WIRE)--\nSemtech Corporation (Nasdaq: SMTC) (the “Company” or “Semtech”) today announced the pricing of $250 million in aggregate principal amount of its 4.00% convertible senior notes due 2028 (the “Notes”) to eligible purchasers in a private placement (the “Placement”) that is exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”).\n\n\nThe sale of the Notes is expected to close on or about October 26, 2023, subject to customary closing conditions, and is expected to result in $242.5 million in net proceeds to the Company, after deducting commissions but before deducting estimated expenses payable by the Company.\n\n\nSemtech intends to use the net proceeds of the Placement, together with cash on hand, in order to prepay term loans outstanding under the Company’s senior credit facilities and to pay any fees and expenses relating thereto or to the Placement.\n\n\nThe Notes will be senior, unsecured obligations of Semtech, and will bear interest at a rate of 4.00% per annum, payable semiannually in arrears on May 1 and November 1 of each year, beginning on May 1, 2024. The Notes will mature on November 1, 2028, unless earlier converted, redeemed or repurchased. The Notes will be jointly and severally and fully and unconditionally guaranteed on a senior unsecured basis by each of Semtech’s current and future direct and indirect wholly-owned domestic subsidiaries that guarantee Semtech’s borrowings under its senior credit facilities.\n\n\nThe initial conversion rate for the Notes is 49.0810 shares of Semtech’s common stock per $1,000 principal amount of Notes (which is equivalent to an initial conversion price of approximately $20.37 per share, which represents a premium of approximately 27.5% over the last reported sale price per share of Semtech’s common stock on October 19, 2023). Prior to August 1, 2028, the Notes will be convertible at the option of the holders only upon the occurrence of specified events and during specified periods, and thereafter until the close of business on the second scheduled trading day immediately preceding the maturity date, the Notes will be convertible at any time. Semtech will settle conversions by paying cash up to the aggregate principal amount of the Notes being converted and paying or delivering, as the case ma...