Supermicro Prices Private Offering Of $2 Bln Convertible Senior Notes; To Buyback 4.9 Mln Shares

(RTTNews) - Super Micro Computer, Inc. or Supermicro (SMCI) announced Tuesday the pricing of $2.0 billion aggregate principal amount of convertible senior notes due 2030, being offered and sold to qualified institutional buyers.

The Total IT Solution Manufacturer for AI, Cloud, Storage, and 5G/Edge also granted an option to the initial purchasers to purchase up to an additional $300 million aggregate principal amount of the Convertible Notes.

Further, Supermicro said it expects to repurchase around 4.9 million shares of its common stock concurrently with the offering from purchasers of the Convertible Notes in privately negotiated transactions.

The offering is expected to close on June 26, subject to the satisfaction of various customary closing conditions.

The Convertible Notes will be the company's senior, unsecured obligations, and it will not bear regular interest, and the principal amount of the Convertible Notes will not accrete.

The company added that the Notes will have an initial conversion rate of 18.1154 shares of its common stock per $1,000 principal amount of Convertible Notes. This is equivalent to an initial conversion price of around $55.20 per share of its common stock, representing an initial conversion premium of around 35.0% above the closing price of $40.89 per share of its common stock on June 23, 2025.

The Notes will be redeemable, in whole or in part, for cash at the company's option at any time, and from time to time, on or after June 15, 2028 and on or before the 20th scheduled trading day immediately before the maturity date, on certain conditions.

The Company will receive net proceeds from the offering of approximately $1.96 billion, or approximately $2.26 billion if the initial purchasers exercise their option to purchase additional Convertible Notes in full.

The company expects to use $158.4 million of the net proceeds of the offering to fund the cost of entering into the capped call transactions, approximately $200.0 million to repurchase shares concurrently with the offering.

The remainder of the net proceeds will be used for general corporate purposes, including to fund working capital for growth and business expansion.