PureCycle Closes $287.5M Convertible Notes, 19.85M Shares Sale; Raises $432.5M Net
PCT•PureCycle closed concurrent offerings of $287.5 million aggregate principal of 4.75% convertible senior notes due 2032 and 19.85 million common shares, raising net proceeds of approximately $432.5 million. The company will use $246.3 million to repurchase $216 million of its 7.25% Green Convertible Notes and allocate remaining funds to further repurchases and general corporate purposes.
1. Offerings Closed and Structure
PureCycle completed concurrent offerings of $287.5 million aggregate principal of 4.75% convertible senior notes due 2032 and 19,854,000 shares of common stock, including $37.5 million of notes and 2,283,800 shares issued to underwriters upon full exercise of over-allotment options. Morgan Stanley served as sole bookrunner for both offerings under an automatically effective shelf registration.
2. Convertible Senior Notes Terms
The notes accrue interest at 4.75% per annum, payable semi-annually on January 1 and July 1, and mature on July 1, 2032, unless earlier converted, redeemed or repurchased. They convert at an initial rate of 90.2242 shares per $1,000 principal (conversion price ~$11.08), a 35% premium to the stock offering price, with customary adjustment and redemption provisions after July 6, 2029.
3. Use of Proceeds and Repurchase Plan
PureCycle received approximately $432.5 million in net proceeds after underwriting discounts and expenses. It will allocate roughly $246.3 million to repurchase $216 million aggregate principal of its 7.25% Green Convertible Senior Notes due 2030 in privately negotiated transactions and use remaining funds for additional repurchases and general corporate purposes.
