The sale of the notes is expected to close on August 18, 2023, subject to customary closing conditions.
The offering was upsized from the previously announced offering of $1 billion to $1.1 billion.
The notes will bear interest at a rate of 1.125% per year, payable semiannually in arrears on February 15 and August 15 of each year, beginning on February 15, 2024.
The notes will be senior unsecured obligations of Akamai and will mature on February 15, 2029.
The conversion rate will initially be 7.9170 shares of Akamai’s common stock per $1,000 principal amount of notes, which is equivalent to an initial conversion price of approximately $126.31 per share of Akamai’s common stock.
The initial conversion price represents a premium of approximately 22.5% to the $103.11 per share closing price of Akamai’s common stock on August 15, 2023.
The net proceeds from this offering will be approximately $1,084.5 million (or approximately $1,247.4 million if the initial purchasers exercise their option to purchase additional notes in full).
Akamai intends to use approximately $127.3 million of the net proceeds from this offering to pay the cost of the convertible note hedge transactions; also intends to use approximately $75.0 million of the net proceeds from the offering to repurchase shares of its common stock from purchasers of the notes in the offering in privately negotiated transactions; and the remaining net proceeds from the offering to repay at maturity a portion of its $1,150 million outstanding aggregate principal amount of 0.125% Convertible Senior Notes due 2025.
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