Avnet, Inc. (NASDAQ: AVT) has announced its intention to offer $500.0 million aggregate principal amount of convertible senior notes due 2030 in a private offering. There's also an expectation to grant the initial purchasers of the notes an option to purchase up to an additional $75.0 million aggregate principal amount of the notes.
The notes will be Avnet’s senior unsecured obligations and are set to mature on September 1, 2030, unless earlier converted, redeemed, or repurchased. Avnet intends to use the net proceeds from the offering to repurchase shares of its common stock in an amount up to approximately $100.0 million and to repay a portion of the amounts outstanding under its revolving credit facility. The remaining net proceeds from the offering will be used for general corporate purposes, including repayment of additional outstanding indebtedness.
The notes will be offered and sold only to qualified institutional buyers pursuant to rule 144A under the Securities Act of 1933. It's important to note that the notes and any shares of Avnet’s common stock issuable upon conversion of the notes have not been registered under the Securities Act, or any state securities law.
The press release does not constitute an offer to sell or a solicitation of an offer to buy the notes or any shares of Avnet’s common stock issuable upon conversion of the notes.
Furthermore, the concurrent repurchases of up to approximately $100.0 million of shares of Avnet’s common stock may result in the common stock trading at prices that are higher than would be the case in the absence of these repurchases, potentially resulting in a higher initial conversion price for the notes. The market has reacted to these announcements by moving the company's shares 0.43% to a price of $53.77. If you want to know more, read the company's complete 8-K report here.
