SNOWFLAKE is seeking to raise US$2 billion from the sale of convertible bonds.
The data analytics provider is offering two tranches of US$1 billion each in a private placement, according to a statement on Monday (Sep 23). Snowflake is marketing its convertible senior notes due 2027 and 2029 respectively with a coupon of 0 to 0.5 per cent each, according to sources familiar with the matter.
Snowflake is seeking a conversion premium of 32.5 to 37.5 per cent for the notes, the sources said, asking not to be identified as the information is not public. It intends to use the proceeds for purposes including buying back as much as US$575 million worth of shares from the buyers of the notes, the statement showed.
The company may also use the proceeds for acquisitions or strategic investments in complimentary businesses, though it does not currently have any such plans, according to the statement.
Snowflake shares closed at US$113.26 each on Monday and fell 3 per cent in after-market trading. They have declined 43 per cent in the year to date, as the company has struggled with disappointing earnings, executive changes and a major hacking incident.
A representative for Snowflake did not immediately respond to requests for comment.
Snowflake offers software that helps customers find, organise and use huge amounts of information from a variety of sources. Under chief executive officer Sridhar Ramaswamy, who took over the role in February, Snowflake has launched products focused on generative artificial intelligence and other new ways to analyse large sets of data. BLOOMBERG
