Box, Inc. Announces Proposed Private Offering of $400 Million of Convertible Senior Notes
Box, Inc. (NYSE:BOX) has announced plans to offer $400 million in convertible senior notes due 2029 to qualified institutional buyers. The company may also grant an option for an additional $60 million. These notes will be convertible into cash, shares of Box's Class A common stock, or a combination thereof. Box intends to use the proceeds to:
1. Fund capped call transactions to offset potential dilution
2. Repurchase a portion of its outstanding 2026 Notes
3. Support working capital and general corporate purposes
The offering's terms, including interest rate and conversion rate, will be determined at pricing. This move could impact Box's stock price and capital structure.
Box, Inc. (NYSE:BOX) ha annunciato piani per offrire 400 milioni di dollari in note senior convertibili con scadenza nel 2029 a investitori istituzionali qualificati. L'azienda potrebbe anche concedere un'opzione per ulteriori 60 milioni di dollari. Queste note saranno convertibili in contanti, azioni della classe A comune di Box, o una combinazione di esse. Box intende utilizzare i proventi per:
1. Finanziarie transazioni capped call per offsettare una potenziale diluizione
2. Riacquistare una parte delle sue note in circolazione del 2026
3. Supportare il capitale di lavoro e scopi aziendali generali
Le condizioni dell'offerta, inclusi tasso di interesse e tasso di conversione, saranno definiti al momento della valutazione. Questo movimento potrebbe influenzare il prezzo delle azioni di Box e la sua struttura di capitale.
Box, Inc. (NYSE:BOX) ha anunciado planes para ofrecer 400 millones de dólares en notas senior convertibles con vencimiento en 2029 a compradores institucionales calificados. La empresa también podría conceder una opción por 60 millones de dólares adicionales. Estas notas serán convertibles en efectivo, acciones de las acciones ordinarias clase A de Box, o una combinación de estas. Box tiene la intención de utilizar los ingresos para:
1. Financiación de transacciones capped call para compensar una posible dilución
2. Recomprar una parte de sus Notas 2026 en circulación
3. Apoyar el capital de trabajo y fines corporativos generales
Los términos de la oferta, incluidos el tipo de interés y la tasa de conversión, se determinarán en el momento de la fijación de precios. Este movimiento podría impactar el precio de las acciones de Box y su estructura de capital.
Box, Inc. (NYSE:BOX)는 2029년 만기 Convertible Senior Notes를 4억 달러 규모로 자격 있는 기관 투자자에게 제공할 계획을 발표했습니다. 회사는 추가로 6천만 달러에 대한 옵션도 부여할 수 있습니다. 이 노트는 현금, Box의 클래스 A 보통주 또는 이들의 조합으로 변환 가능합니다. Box는 수익금을 다음을 위해 사용할 계획입니다:
1. 잠재적 희석을 상쇄하기 위한 capped call 거래 자금 조달
2. 2026년 발행된 노트 일부 매입
3. 운영 자본 및 일반 기업 목적 지원
제안의 조건, 금리 및 전환 비율은 가격 책정 시 결정됩니다. 이 조치는 Box의 주가와 자본 구조에 영향을 미칠 수 있습니다.
Box, Inc. (NYSE:BOX) a annoncé des plans pour offrir 400 millions de dollars en obligations convertibles senior arrivant à échéance en 2029 à des acheteurs institutionnels qualifiés. La société pourrait également accorder une option pour 60 millions de dollars supplémentaires. Ces obligations seront convertibles en espèces, en actions ordinaires de classe A de Box, ou en une combinaison de ces options. Box prévoit d'utiliser les produits pour :
1. Financer des transactions capped call pour compenser une dilution potentielle
2. Racheter une partie de ses obligations 2026 en circulation
3. Soutenir le fonds de roulement et les objectifs d'entreprise généraux
Les conditions de l'offre, y compris le taux d'intérêt et le taux de conversion, seront déterminées lors de la tarification. Ce mouvement pourrait avoir un impact sur le prix de l'action de Box et sa structure de capital.
Box, Inc. (NYSE:BOX) hat Pläne angekündigt, 400 Millionen Dollar an wandelbaren Senior-Notes mit Fälligkeit im Jahr 2029 an qualifizierte institutionelle Käufer anzubieten. Das Unternehmen könnte auch eine Option über zusätzlich 60 Millionen Dollar gewähren. Diese Notes werden in Bargeld, Aktien von Box's Klasse A Stammaktien oder eine Kombination davon umwandelbar sein. Box beabsichtigt, die Einnahmen zu verwenden für:
1. Finanzierung von capped call-Transaktionen zur Minderung potenzieller Verwässerung
2. Rückkauf eines Teils seiner ausstehenden 2026 Notes
3. Unterstützung des Working Capitals und allgemeine Unternehmenszwecke
Die Bedingungen des Angebots, einschließlich Zinssatz und Umwandlungsrate, werden zum Zeitpunkt der Preisfestsetzung festgelegt. Dieser Schritt könnte den Aktienkurs von Box und die Kapitalstruktur beeinflussen.
- Potential to raise up to $460 million in capital
- Implementation of capped call transactions to mitigate dilution
- Opportunity to refinance existing 2026 Notes
- Increased financial flexibility for working capital and strategic initiatives
- Potential dilution of existing shareholders if notes are converted to stock
- Increased debt load and interest expenses
- Possible negative impact on stock price due to market reactions and hedging activities
Insights
Box's proposed
The capped call transactions are a smart hedge against potential dilution, protecting existing shareholders. However, investors should note that these transactions and the repurchase of 2026 notes could create short-term volatility in Box's stock price. The offering's success will depend on market conditions and investor appetite for tech sector debt, given current economic uncertainties.
Box's move to raise capital through convertible notes highlights the company's confidence in its long-term growth prospects in the Intelligent Content Cloud market. This sector is experiencing increased demand due to digital transformation initiatives across industries. The potential use of funds for acquisitions suggests Box may be eyeing strategic expansion to enhance its product offerings or market reach.
However, investors should consider the competitive landscape, including threats from tech giants like Microsoft and Google. Box's ability to innovate and differentiate its services will be important for justifying this additional debt. The company's focus on working capital and general corporate purposes indicates a balanced approach between growth investments and financial stability.
The notes will be general senior, unsecured obligations of Box and will accrue interest payable semiannually in arrears. The notes will mature on September 15, 2029, unless earlier converted, repurchased or redeemed. The notes will be convertible into cash up to the aggregate principal amount of the notes to be converted and cash, shares of Box’s Class A common stock (“common stock”), or a combination of cash and shares of Box’s common stock, in respect of the remainder, if any, of Box’s conversion obligation in excess of the aggregate principal amount of the notes being converted, at Box’s election. The interest rate, initial conversion rate and other terms of the notes will be determined at the time of pricing of the offering.
Box expects to use a portion of the net proceeds from the offering to pay the cost of the capped call transactions described below. Box also intends to use a portion of the net proceeds from this offering for the repurchase of a portion of its outstanding
In connection with the pricing of the notes, Box expects to enter into capped call transactions with one or more of the initial purchasers and/or their respective affiliates and/or other financial institutions (the “option counterparties”). The capped call transactions are expected generally to offset the potential dilution to Box’s common stock upon any conversion of notes and/or any cash payments Box is required to make in excess of the principal amount of converted notes, as the case may be, with such offset subject to a cap. If the initial purchasers exercise their option to purchase additional notes, Box expects to enter into additional capped call transactions with the option counterparties.
Box has been advised that, in connection with establishing their initial hedges of the capped call transactions, the option counterparties or their respective affiliates may enter into various derivative transactions with respect to Box’s common stock and/or purchase shares of Box’s common stock concurrently with or shortly after the pricing of the notes. This activity could increase (or reduce the size of any decrease in) the market price of Box’s common stock or the notes at that time.
In addition, Box has been advised that the option counterparties or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to Box’s common stock and/or purchasing or selling Box’s common stock or other securities of Box in secondary market transactions following the pricing of the notes and prior to the maturity of the notes and are likely to do so in connection with any early conversion, repurchase or redemption of the notes to the extent Box unwinds a corresponding portion of the capped call transactions, or if Box otherwise unwinds all or a portion of the capped call transactions, and on each exercise date for the capped call transactions. This activity could also cause or prevent an increase or a decrease in the market price of Box’s common stock or the notes, which could affect a noteholder’s ability to convert the notes and, to the extent the activity occurs during any observation period related to a conversion of notes, affect the amount and value of the consideration that a noteholder will receive upon conversion of its notes.
Box also expects in connection with the repurchase of a portion of its 2026 Notes, those holders of the 2026 Notes that sell their 2026 Notes to Box may enter into or unwind various derivatives with respect to Box’s common stock and/or purchase shares of Box’s common stock concurrently with or shortly after the pricing of the notes. In particular, Box expects that many holders of the 2026 Notes employ a convertible arbitrage strategy with respect to the 2026 Notes and have a short position with respect to Box’s common stock that they would close, through purchases of Box’s common stock, in connection with Box’s repurchase of the 2026 Notes. This activity could increase (or reduce the size of any decrease in) the market price of Box’s common stock, which may also affect the trading price of the notes at that time, and could result in a higher effective conversion price for the notes. The initial conversion price for the notes will be determined based on the last reported sale price of Box’s common stock per share on the New York Stock Exchange on the day of pricing of the offering.
In connection with the issuance of its 2026 Notes, Box entered into capped call transactions (the “existing capped call transactions”) with certain financial institutions (the “existing capped call counterparties”). If Box repurchases any of the 2026 Notes, Box expects to enter into agreements with the existing capped call counterparties to terminate a portion of the existing capped call transactions corresponding to any principal amount of the 2026 Notes repurchased. In connection with the termination of any of these transactions, Box has been advised that the existing capped call counterparties or their respective affiliates expect to sell shares of Box’s common stock and/or unwind various derivatives with respect to Box’s common stock to unwind their hedge in connection with those transactions. Such activity could decrease, or reduce the size of any increase in, the market price of Box’s common stock.
The offer and sale of the notes, and any shares of Box’s common stock potentially issuable upon conversion of the notes, have not been, and will not be, registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in
This press release is neither an offer to sell nor a solicitation of an offer to buy any securities, nor shall it constitute an offer, solicitation or sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240916515292/en/
Investors:
Cynthia Hiponia/Elaine Gaudioso
ir@box.com
Media:
Kait Conetta
press@box.com
Source: Box, Inc.
FAQ
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