Applied Digital Corporation Raises $450 Million in Convertible Notes Offering
Applied Digital Corporation (APLD), a prominent player in the design, construction, and operation of cutting-edge digital infrastructure for high-performance computing applications, has successfully closed a $450 million private offering of 2.75% Convertible Senior Notes due 2030. This strategic move reflects the company’s confidence in its future growth prospects and its commitment to maximizing shareholder value.
The offering, which was made to qualified institutional buyers under Rule 144A, saw an overwhelming response with the initial purchasers exercising their option to acquire an additional $75 million of notes. The total proceeds from the offering, after deducting discounts, commissions, and estimated expenses, amounted to approximately $434.5 million.
Applied Digital has outlined its plans for deploying these funds, emphasizing its commitment to strategic investments and shareholder returns.
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Share Repurchases:
The company intends to utilize approximately $84 million of the proceeds to repurchase its common stock, including $52.7 million for prepaid forward repurchase transactions and $31.3 million for direct share buybacks. This strategic maneuver indicates a strong belief in the company’s intrinsic value and its potential for continued growth.*
Capped Call Transactions:
A significant portion of the funds, around $51.8 million, will be allocated to covering the costs associated with capped call transactions. These transactions provide a mechanism to manage potential dilution associated with the convertible notes while also allowing the company to maintain flexibility.*
General Corporate Purposes:
The remaining proceeds will be used for general corporate purposes, including funding research and development initiatives, expanding its data center infrastructure, and pursuing strategic acquisitions or partnerships.About Applied Digital
Applied Digital distinguishes itself through its specialized approach to data center development. The company’s purpose-built facilities are engineered to harness the power of accelerated computing, delivering secure, scalable, and sustainable digital hosting solutions. This commitment to innovation positions Applied Digital as a trusted provider of high-performance computing and cloud infrastructure to a range of clients, including those in the AI/ML, blockchain, and high-performance computing sectors.
Forward-Looking Statements
This press release includes forward-looking statements, which reflect Applied Digital’s current expectations and projections for the future. These statements are subject to inherent uncertainties and risks, and actual results may differ materially from those anticipated. The company cautions investors not to place undue reliance on these forward-looking statements.
Contact:
Investor Relations:
Matt Glover and Ralf Esper
Gateway Group, Inc.
(949) 574-3860
APLD@gateway-grp.com
Media Contact:
Buffy Harakidas, EVP and Jo Albers
JSA (Jaymie Scotto & Associates)
jsa_applied@jsa.net
(856) 264-7827
