Summary
Workday, Inc. (WDAY) announced on June 11, 2013, the pricing of two series of convertible senior notes. The company priced $310 million in aggregate principal amount of 0.75% Convertible Senior Notes due 2018 and $220 million in aggregate principal amount of 1.50% Convertible Senior Notes due 2020. This financing move is significant as it provides Workday with substantial capital, totaling $530 million initially, with the potential for an additional $70 million if the underwriters exercise their overallotment options. These notes are offered to qualified institutional buyers, indicating a focus on institutional investment. The issuance of convertible debt suggests Workday's strategy to fund growth and operations while potentially leveraging its stock performance in the future. The capital raised through this offering is expected to support Workday's ongoing business development, technological advancements, and market expansion. The relatively low coupon rates on the convertible notes (0.75% and 1.50%) reflect market confidence in Workday's financial stability and growth prospects. Investors should monitor how this new capital is deployed and its impact on the company's revenue growth, profitability, and competitive positioning in the enterprise software market.
Key Highlights
- 1Workday priced $310 million of 0.75% Convertible Senior Notes due 2018.
- 2Workday priced $220 million of 1.50% Convertible Senior Notes due 2020.
- 3The company has the option to purchase an additional $40 million of 2018 Notes and $30 million of 2020 Notes.
- 4Total initial proceeds from the note offering amount to $530 million.
- 5The notes are being sold to qualified institutional buyers under Rule 144A.
- 6This filing includes a press release detailing the note pricing as Exhibit 99.1.