Ziff Davis, Inc. (formerly known as J2 Global, Inc.) has recently announced a maturity extension transaction on a portion of its 1.75% convertible senior notes due 2026. The company has entered into separate, privately negotiated exchange agreements with a limited number of holders of its existing notes. As a result of these agreements, Ziff Davis will exchange approximately $401 million in aggregate principal amount of the existing notes for approximately $263 million in aggregate principal amount of new 3.625% convertible senior notes due 2028 and approximately $135 million in cash.
Upon completion of the exchange, the aggregate principal amount of the existing notes outstanding will be approximately $149 million, and the aggregate principal amount of the new notes outstanding will be approximately $263 million. The new notes will be general senior unsecured obligations of the company and bear interest at a rate of 3.625% per annum, payable semi-annually. They will mature on March 1, 2028, unless earlier converted or repurchased.
The conversion rate for the new notes will initially be 10 shares per $1,000 principal amount of new notes, equivalent to an initial conversion price of $100 per share of the company’s common stock. The new notes will be convertible only upon satisfaction of certain conditions and during certain periods until December 1, 2027, and thereafter, they will be convertible at any time until the close of business on the business day immediately preceding the maturity date.
It's worth noting that neither the new notes nor any shares of the company’s common stock issuable upon conversion of the new notes have been registered under the securities act or any state securities laws.
Ziff Davis, a vertically focused digital media and internet company, has a portfolio that includes leading brands in technology, shopping, gaming and entertainment, connectivity, health and wellness, cybersecurity, and martech. Following these announcements, the company's shares moved -2.1%, and are now trading at a price of $51.86. For the full picture, make sure to review Ziff Davis's 8-K report.
