Square Inc. plans to offer $750 million of convertible senior notes due in 2023 in a private placement to qualified institutional buyers.
The notes will be the company's senior unsecured obligations, with interest payable semiannually in arrears. The notes will be convertible into Square's class A common shares, cash or a combination of the two. The company expects to offer the initial purchasers a 30-day option to buy up to an additional $112.5 million of the notes to cover any overallotments.
In connection with the notes' pricing, the company expects to enter into privately negotiated convertible note hedge transactions with one or more of the initial purchasers, their affiliates or another financial institution. Square also expects to enter into privately negotiated warrant transactions with the hedge counterparties.
Square expects to use part of the net proceeds to pay off the cost of the convertible note hedge transactions and to use the remaining proceeds of the offering for general corporate purposes.
