- Array Technologies Inc’s (NASDAQ: ARRY) stock price fell 7% after hours today. That’s why it happened.
Array Technologies Inc’s (NASDAQ: ARRY) stock price fell 7% after hours today. Investors are reacting negatively to the announcement by Array Technologies that, subject to market conditions, it intends to offer $ 325 million in aggregate principal of convertible senior notes due 2028 (the Notes) in the part of a private placement to qualifying buyers under Rule 144A of the Securities Act of 1933, as amended.
Array also plans to grant the initial purchasers of the tickets an option to purchase (within 13 days from) and including the date the tickets are first issued up to an additional total principal amount. of $ 48.75 million. And Array expects to use the net proceeds of the offering – as well as cash and / or borrowings under its revolving credit facility and the issuance of up to $ 100 million of preferred shares of Series A in accordance with the Company’s Series A preferred share facility – to pay the cash consideration for its previously announced acquisition of Soluciones Técnicas Integrales Norland, SL (the acquisition of STI) and the cost of call transactions capped described below.
If the initial buyers exercise their option to purchase additional tickets, Array Technologies expects to use the net proceeds to fund a portion of the cash consideration of the STI acquisition, to enter into additional capped purchase transactions with the consideration for the option and for general corporate purposes, including repayment of the corporate term loan. In the event that the STI acquisition is not completed, Array plans to use the net proceeds of the offering to pay for the cost of capped call transactions and for general corporate purposes, including the repayment of the company’s term loan.
The Notes will be senior unsecured obligations of Array and will accrue interest payable semi-annually in arrears. And Array will settle the conversions by paying in cash up to the full principal amount of the Notes to be converted and paying or delivering, as the case may be, cash, Array common stock or a combination of cash and stock. ordinary, at Array’s option, with regard to the balance (if any) of the Array conversion obligation in excess of the total principal amount of the notes to be converted, on the basis of the conversion rate then applicable. The interest rate, initial conversion rate and other terms of the Notes will be determined at the time of pricing of the Offer.
As part of the pricing of the Notes, Array expects to enter into privately negotiated capped purchase transactions with one or more of the original purchasers or their respective subsidiaries and / or other financial institutions (the option counterparties). ). And the capped purchase transactions will cover, subject to anti-dilution adjustments, the number of common shares initially underlying the ratings sold under the offer.
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