Semtech Raises $300M Via Private Debt Offering To Fund Sierra Wireless Acquisition

Author: Anusuya Lahiri | October 07, 2022 10:40am

• Semtech Corp (NASDAQ:SMTC) priced $300 million of its 1.625% convertible senior notes due 2027 in a private placement.
• Semtech upsized the offering from $250 million.
• The initial purchasers have 13 days to purchase an additional $37.5 million aggregate principal amount of notes.
• The estimated offering proceeds are $290.0 million.
• Semtech expects to use $27.8 million of the proceeds to pay the cost of certain convertible note hedge transactions. 
• Semtech plans to finance the purchase price for Sierra Wireless, Inc (NASDAQ:SWIR), with the remainder of the proceeds together with the borrowings under the term loan facility, revolving credit facility, and available cash and equivalents.
• If the acquisition does not materialize, Semtech will use the remainder of the proceeds to fund a portion of the redemption price of the notes or for general corporate purposes.
• The initial conversion price of $37.27 per share represents a premium of 27.50% over Semtech's last reported sale price per share on October 6, 2022.
• Semtech held $171.9 million in long-term debt and $362.2 million in cash and equivalents as of July 31.
• Price Action: SMTC shares traded lower by 5.68% at $27.57 on the last check Friday.

Posted In: SMTC SWIR