Snowflake drops on plans for $3.5 billion 0% convertible debt sale
SNOW•Snowflake shares fell 5% in premarket trading as the company proposed selling $1.3 billion of 0% convertible notes due in 2029 and $2.2 billion due in 2031. It plans to use some proceeds to repurchase 2027 notes, buy back shares, fund acquisitions or investments, and pay for capped call transactions.
1. Proposed debt offering
Snowflake proposed privately offering $1.3 billion of 0% convertible senior notes due October 15, 2029, and $2.2 billion of 0% notes due October 15, 2031. Its shares fell 5% in premarket trading.
2. Planned use of proceeds
Snowflake intends to use net proceeds to repurchase a portion of its 0% convertible notes due in 2027. It also plans to use some proceeds for stock repurchases, acquisitions or investments, and capped call transactions intended to offset potential dilution.
