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Infinera negotiates for less 2024 convertibles, more 2028 notes
Chicago, May 17 – Infinera Corp. reported that it essentially privately negotiated a liability management transaction whereby it increased the size of an issue of convertible senior notes due 2028 and decreased the amount outstanding on an issue due in 2024, according to an 8-K filing with the Securities and Exchange Commission.
On Tuesday, for the reduction of the notes due in 2024, the company worked with certain investors in privately negotiated agreements to repurchase $83.9 million of its 2.125% convertible senior notes.
After the buyback, there will be $18.7 million of the notes outstanding.
The repurchase price for the notes will be determined over a 20-trading-day averaging period.
For the new notes, Infinera is selling to qualified investors $100 million of additional 3.75% convertible senior notes due Aug. 1, 2028.
HudsonWest LLC acted as sole placement agent for the sale.
Except for a different Cusip number, the terms will be identical to an issue of existing notes.
The issue price, like the buyback, will be determined over a 20-trading-day averaging period.
For the 2028 notes, the current conversion rate is 147.1183 shares of common stock per $1,000 note, equivalent to a conversion price of $6.80 per share.
Conversion can be in cash, shares or a combination of cash and shares, determined by the company.
Before May 1, 2028, the notes will be convertible at the option of the holders only upon the satisfaction of certain conditions. After that date, the notes are convertible at any time until two trading days before the maturity date.
The convertibles are redeemable at par for cash after Aug. 5, 2025 subject to a 130% hurdle.
There is protection for any fundamental change at par.
Infinera is a San Jose, Calif.-based global supplier of optical networking equipment.
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