Penguin Solutions plans unregistered private offering of USD 650 million convertible notes due 2031

Penguin Solutions flagged an unregistered offering of $650 million of convertible senior notes due 2031 to qualified institutional buyers under Rule 144A, with an option for initial purchasers to buy up to an additional $100 million.

Net proceeds are expected to fund capped call transactions. Net proceeds are expected to refinance portions of existing 2% convertible senior notes due 2029 and 2030 through privately negotiated exchanges. Net proceeds are expected to repay $100 million under a credit agreement. Remaining proceeds are expected to support general corporate purposes.

The company expects to issue shares in the exchange transactions, with additional shares potentially deliverable on conversions of the 2031 notes. The terms, including the interest rate and initial conversion rate, will be set at pricing.