Uber Technologies (NYSE:UBER) plans to issue $1.2B in convertible senior notes due 2028, exclusively to qualified institutional buyers.
Initial purchasers of the notes will have the option to purchase up to an additional $180M of the notes.
A portion of the net proceeds will be used to fund the cost of entering into the capped call transactions and the remainder to repay, redeem, or repurchase outstanding indebtedness, including the redemption of the outstanding $1B of Uber’s 7.500% senior notes due 2025.
In connection with the pricing of the notes, Uber plans to engage in privately negotiated capped call transactions with option counterparties to minimize potential dilution to its common stock.
These transactions will cover the initial shares of Uber’s common stock under its notes, subject to anti-dilution adjustments.
This could potentially impact the market price of Uber’s common stock or notes, affecting noteholders’ conversion ability and consideration value.
