Spotify Prices $1,300.0 Million Exchangeable Senior Notes Offering
February 26 2021 - 6:00AM
Business Wire
Spotify Technology S.A. (“Spotify”) (NYSE: SPOT) today announced
that on February 25, 2021, its indirect subsidiary, Spotify USA
Inc. (“Spotify USA”), priced its offering of $1,300,000,000
aggregate principal amount of 0% exchangeable senior notes due 2026
(the “notes”) in a private offering to qualified institutional
buyers pursuant to Rule 144A under the Securities Act of 1933, as
amended (the “Securities Act”). The notes will be fully and
unconditionally guaranteed, on a senior, unsecured basis, by
Spotify. The issuance and sale of the notes are scheduled to settle
on March 2, 2021, subject to customary closing conditions. Spotify
USA also granted the initial purchasers of the notes an option to
purchase, for settlement within a period of 13 days from, and
including, the date the notes are first issued, up to an additional
$200,000,000 principal amount of notes.
The notes will be senior, unsecured obligations of Spotify USA.
The notes will not bear regular interest, and the principal amount
of the notes will not accrete. The notes will mature on March 15,
2026, unless earlier repurchased, redeemed or exchanged. Before
December 15, 2025, noteholders will have the right to exchange
their notes only upon the occurrence of certain events. From and
after December 15, 2025, noteholders may exchange their notes at
any time at their election until the close of business on the
second scheduled trading day immediately before the maturity date.
Spotify USA will settle exchanges by paying or delivering, as
applicable, cash, ordinary shares of Spotify or a combination of
cash and ordinary shares of Spotify, at Spotify USA’s election. The
initial exchange rate is 1.9410 ordinary shares per $1,000
principal amount of notes, which represents an initial exchange
price of approximately $515.20 per ordinary share. The initial
exchange price represents a premium of approximately 70.0% over the
last reported sale price of $303.06 per ordinary share of Spotify
on February 25, 2021. The exchange rate and exchange price will be
subject to adjustment upon the occurrence of certain events.
The notes will not be redeemable prior to March 20, 2024, except
in the event of certain tax law changes. The notes will be
redeemable, in whole or in part (subject to certain limitations),
for cash at Spotify USA’s option at any time, and from time to
time, on or after March 20, 2024 and on or before the 40th
scheduled trading day immediately before the maturity date, but
only if the last reported sale price per ordinary share of Spotify
exceeds 130% of the exchange price for a specified period of time.
In addition, the notes will be redeemable, in whole and not in
part, at Spotify USA’s option at any time in connection with
certain changes in tax law. The redemption price will be equal to
the principal amount of the notes to be redeemed, plus accrued and
unpaid special and additional interest, if any, to, but excluding,
the redemption date.
If a “fundamental change” (as defined in the indenture for the
notes) occurs, then, subject to a limited exception, noteholders
may require Spotify USA to repurchase their notes for cash. The
repurchase price will be equal to the principal amount of the notes
to be repurchased, plus accrued and unpaid special and additional
interest, if any, to, but excluding, the applicable repurchase
date.
Spotify USA estimates that the net proceeds from the offering
will be approximately $1,281 million (or approximately $1,479
million if the initial purchasers fully exercise their option to
purchase additional notes), after deducting the initial purchasers’
discounts and commissions and estimated offering expenses. Spotify
USA intends to use the net proceeds from the offering for general
corporate purchases.
The offer and sale of the notes, the guarantee and any ordinary
shares issuable upon exchange of the notes have not been, and will
not be, registered under the Securities Act or any other securities
laws, and the notes and any such ordinary shares cannot be offered
or sold except pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities Act
and any other applicable securities laws. This press release does
not constitute an offer to sell, or the solicitation of an offer to
buy, the notes or any ordinary shares issuable upon exchange of the
notes, nor will there be any sale of the notes or any such ordinary
shares, in any state or other jurisdiction in which such offer,
sale or solicitation would be unlawful.
Forward-Looking Statements
This press release includes forward-looking statements,
including statements regarding the completion of the offering and
the expected amount and intended use of the net proceeds.
Forward-looking statements represent the current expectations of
Spotify and Spotify USA regarding future events and are subject to
known and unknown risks and uncertainties that could cause actual
results to differ materially from those implied by the
forward-looking statements. Among those risks and uncertainties are
market conditions, the satisfaction of the closing conditions
related to the offering and risks relating to the respective
businesses of Spotify and Spotify USA, including those described in
periodic reports that Spotify files from time to time with the SEC.
Spotify USA may not consummate the offering described in this press
release and, if the offering is consummated, cannot provide any
assurances regarding its ability to effectively apply the net
proceeds as described above. The forward-looking statements
included in this press release speak only as of the date of this
press release, and neither Spotify nor Spotify USA undertakes to
update the statements included in this press release for subsequent
developments, except as may be required by law.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210226005156/en/
Investor Relations Bryan Goldberg ir@spotify.com
Public Relations Dustee Jenkins press@spotify.com
Spotify Technology (NYSE:SPOT)
Historical Stock Chart
From Aug 2024 to Sep 2024
Spotify Technology (NYSE:SPOT)
Historical Stock Chart
From Sep 2023 to Sep 2024