Snowflake Inc. (NYSE: SNOW), the leading AI Data Cloud company, unveiled plans for a private placement of $2 billion in convertible senior notes. The offering consists of $1 billion in 2027 convertible notes and another $1 billion in 2029 convertible notes. The notes are being offered to institutional investors under Rule 144A of the Securities Act of 1933, subject to market conditions and other factors.
In addition, the initial purchasers have the option to buy an extra $150 million of each series of notes within 13 days of issuance. The notes will be unsecured obligations and accrue interest payable semiannually. Upon conversion, Snowflake will have the discretion to pay in cash, Class A common stock, or a combination of both.
The company plans to use the proceeds from this offering for various corporate purposes, including repurchasing up to $575 million worth of its common stock in privately negotiated transactions, as well as funding capped call transactions. Snowflake will also use any remaining funds for potential stock repurchases under existing or future programs and for strategic investments or acquisitions, though there are no immediate plans for such moves.
This capital raise enhances Snowflake’s financial flexibility, supporting its growth initiatives and strengthening its balance sheet for future opportunities. Further details, including interest rates and conversion terms, will be determined upon final pricing of the offering.
In addition, the initial purchasers have the option to buy an extra $150 million of each series of notes within 13 days of issuance. The notes will be unsecured obligations and accrue interest payable semiannually. Upon conversion, Snowflake will have the discretion to pay in cash, Class A common stock, or a combination of both.
The company plans to use the proceeds from this offering for various corporate purposes, including repurchasing up to $575 million worth of its common stock in privately negotiated transactions, as well as funding capped call transactions. Snowflake will also use any remaining funds for potential stock repurchases under existing or future programs and for strategic investments or acquisitions, though there are no immediate plans for such moves.
This capital raise enhances Snowflake’s financial flexibility, supporting its growth initiatives and strengthening its balance sheet for future opportunities. Further details, including interest rates and conversion terms, will be determined upon final pricing of the offering.