Semtech Corporation Announces Pricing of Private Offering of $350 Million of New Convertible Senior Notes and Exchange of Existing Notes

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 its offering of $350 million in aggregate principal amount of 0% convertible senior notes due 2030 (the “Notes”) in a private placement (the “Offering”) to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). Semtech has granted the initial purchasers of the Notes an option to purchase, for settlement by (and including) October 15, 2025, up to an additional $52.5 million aggregate principal amount of Notes. The sale of the Notes is expected to close on or about October 10, 2025, subject to customary closing conditions, and is expected to result in approximately $340.2 million in net proceeds to the Company, after deducting the initial purchasers’ discount and estimated offering expenses payable by the Company (assuming no exercise of the initial purchasers’ option).\n\n\nSemtech expects to use (i) approximately $220.6 million of the net proceeds from the Offering, together with the issuance of approximately 3.0 million shares of Semtech’s common stock, as the consideration for the exchange of approximately $219.0 million aggregate principal amount of its existing 1.625% convertible senior notes due 2027 (the “2027 Notes”), (ii) approximately $63.1 million of the net proceeds from the Offering, together with the issuance of approximately 2.2 million shares of Semtech’s common stock, as the consideration for the exchange of $61.95 million aggregate principal amount of its existing 4.00% convertible senior notes due 2028 (the “2028 Notes” and, together with the 2027 Notes, the “Existing Notes”), which constitutes the remaining outstanding amount of the 2028 Notes and (iii) approximately $56.5 million of the net proceeds from the Offering to repay $56.3 million principal amount of the term loans outstanding under Semtech’s senior credit facilities. Semtech also intends to use approximately $27.3 million of cash on hand to pay the cost of the capped call transactions described below (the cost of which is expected to be partially offset by the proceeds from the termination of the existing convertible note hedge and warrant transactions that Semtech entered into in connection with the issuance of the 20...

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