SoFi Technologies (NASDAQ: SOFI) stock plummeted over 15% on Tuesday after the company revealed plans to sell up to $862.5 million in convertible bonds.
SoFi Technologies (SOFI) has announced plans to launch a $750 million private offering of convertible senior notes, due in 2029, exclusively for qualified institutional buyers. The company will also offer initial purchasers a 13-day option to buy up to an extra $112.5 million in notes.
The company outlined its allocation strategy for the net proceeds, with a portion earmarked for financing capped call transactions. These transactions will mitigate potential dilution risks from the notes’ conversion or offset cash payments required upon conversion. The company anticipates utilizing the remaining proceeds, alongside existing cash reserves, to cover fees, costs, and expenses associated with the offering.
Moreover, SoFi plans to redeem its 12.5% Series 1 Preferred Stock using a portion of the proceeds, with the remainder slated for general corporate purposes, including the potential repayment of higher-cost debts.
SoFi Technologies (NASDAQ: SOFI) Stock Price Action
SOFI stock plunged 15.27% to close at $7.27 on Tuesday. The traders had exchanged hands with 186,115,611 (186.11 million) shares compared to the average daily trading volume of 51.20 million.
Edward Cooke is a financial analyst, freelance writer, and editor. He has six years of experience in financial journalism. He has an in-depth understanding of equities markets, tracking major indices and providing real-time analysis on stock price movements, corporate earnings, and market sentiment.
