Semtech Announces $350M Convertible Notes Offering

By Greg Peters • Sunday, October 12 17:31 • Permanent Link

Semtech Corporation (NASDAQ: SMTC) recently announced the pricing of its offering of $350 million in aggregate principal amount of 0% convertible senior notes due 2030 in a private placement. The sale of the notes is expected to result in approximately $340.2 million in net proceeds to the company.

Semtech intends to use the net proceeds from the offering, together with the issuance of approximately 3.0 million shares of its common stock, as consideration for the exchange of approximately $219.0 million aggregate principal amount of its existing 1.625% convertible senior notes due 2027. Additionally, approximately $63.1 million of the net proceeds from the offering, together with the issuance of approximately 2.2 million shares of common stock, will be used as consideration for the exchange of $61.95 million aggregate principal amount of its existing 4.00% convertible senior notes due 2028.

The initial conversion rate for the notes is 9.8964 shares of Semtech’s common stock per $1,000 principal amount of notes. This represents a premium of approximately 42.50% over the last reported sale price per share of Semtech’s common stock on the Nasdaq Global Select Market on October 7, 2025.

The notes are anticipated to be senior unsecured obligations of Semtech and will not bear regular interest. Furthermore, the notes will not be redeemable before October 20, 2028.

In connection with the pricing of the notes, Semtech entered into privately negotiated capped call transactions with certain financial institutions, which are expected to reduce potential dilution to Semtech’s common stock upon any conversion of the notes.

Semtech Corporation is a leading provider of high-performance semiconductor, Internet of Things (IoT) systems, and cloud connectivity service solutions. The company's global teams aim to empower solution architects and application developers to create breakthrough products for the infrastructure, industrial, and consumer markets. Following these announcements, the company's shares moved -0.71%, and are now trading at a price of $70.04. For more information, read the company's full 8-K submission here.

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