AMD Announces Pricing and Upsize of $700 Million of Convertible Senior Notes
OREANDA-NEWS. AMD (NASDAQ: AMD) today announced the pricing of an upsized public offering of $700 million aggregate principal amount of its 2.125% Convertible Senior Notes due 2026 (the "New Notes"). The offering of the New Notes was upsized from an originally announced amount of $450 million. AMD also announced the pricing of a public offering of shares of its common stock (the "Shares") of $600 million at a price of $6.00 per share. AMD expects the transactions to close on or around Sept. 14, 2016, subject to customary closing conditions. AMD also granted the underwriters a 30-day option to purchase up to 15 million additional Shares at the public offering price and up to $105 million principal amount of additional New Notes. AMD estimates that the net proceeds from the issuance and sale of the Shares and the New Notes (the "Net Proceeds") will be approximately $1.26 billion after deducting the underwriters' discounts and estimated offering expenses.
The New Notes will be unsecured, unsubordinated obligations of AMD, and interest will be payable semi-annually at a rate of 2.125% per year. The initial conversion rate of the New Notes is 125.0031 shares of common stock per $1,000 principal amount of the New Notes (which is equivalent to an initial conversion price of approximately $8.00 per share). Upon conversion, AMD will pay or deliver, as the case may be, cash, shares of common stock of AMD or a combination of cash and shares of common stock of AMD, at its election.
AMD intends to use the Net Proceeds received from the offerings to repay its borrowings under its credit facility and/or to purchase its outstanding senior notes. After the completion of a tender offer for its outstanding senior notes, AMD has the option, but not the obligation, to call any and all of the untendered 7.75% Senior Notes due 2020 with any remaining net proceeds. AMD will use any remaining net proceeds for capital expenditures, working capital and other general corporate purposes.
J.P. Morgan Securities LLC, Barclays Capital Inc. and Credit Suisse Securities (USA) LLC are acting as joint lead book-running managers for the offering of the Shares. BofA Merrill Lynch, Wells Fargo Securities, LLC, Deutsche Bank Securities Inc. and Morgan Stanley & Co. LLC are also joint book-running managers for the offering of the Shares.
J.P. Morgan Securities LLC, Barclays Capital Inc. and Credit Suisse Securities (USA) LLC are joint lead book-running managers for the offering of the New Notes. BofA Merrill Lynch and Wells Fargo Securities, LLC are also joint book-running managers for the offering of the New Notes.
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