Peloton Interactive, Inc. announced its intention to offer $600 million aggregate principal amount of convertible senior notes due 2026
The notes, to be sold in a private offering, will be senior, unsecured obligations of Peloton, and will bear interest payable semi-annually in arrears. The notes will be convertible into cash, shares of Peloton’s Class A common stock, or a combination thereof, at Peloton’s election. The interest rate, conversion rate, and other terms of the notes are to be determined upon pricing of the offering.
Peloton also expects to grant the initial purchasers of the notes a 13-day option to purchase up to an additional $90.0 million aggregate principal amount of the notes.
In connection with the pricing of the notes, Peloton expects to enter into privately negotiated capped call transactions with one or more of the initial purchasers and/or their respective affiliates and/or other financial institutions.
Peloton intends to use a portion of the net proceeds of the offering of the notes to pay the cost of the capped call transactions. If the initial purchasers exercise their option to purchase additional notes, Peloton expects to use a portion of the net proceeds from the sale of such additional notes to enter into additional capped call transactions. Peloton intends to use the remainder of the net proceeds from the offering for general corporate purposes, which may include working capital, capital expenditures, including for the construction or expansion of facilities, and investments in and acquisitions of other companies, products or technologies that Peloton may identify in the future.
Photo courtesy Peloton
