Meta closes $12.5B mandatory convertible preferred offering and 40M share forward sale
Meta Platforms has closed a $12.5 billion mandatory convertible preferred stock offering of 250 million depositary shares (each representing 1/20th interest in 6.50% Series A Preferred Stock) and concurrently entered into forward sale agreements for 40 million shares of Class A common stock with Morgan Stanley and Goldman Sachs. The mandatory convertible preferred has a $1,000 liquidation preference, a 6.50% annual dividend rate payable quarterly, and will automatically convert into 1.3620-1.6000 shares of Class...
Key takeaways
Depositary shares: 250 million Series A depositary shares priced at $50.00 public offering price, $49.8335 purchase price, representing 1/20th interest in 6.50% Series A Mandatory Convertible Preferred Stock with $1,000 liquidation preference
Preferred stock dividend: 6.50% annual rate on $1,000 liquidation preference, payable quarterly starting February 15, 2027, may be paid in cash or shares of Class A Common Stock
Mandatory conversion: Each preferred share converts to 1.3620-1.6000 shares of Class A Common Stock on or about August 15, 2029, with conversion rate determined by 20-trading-day average price
Forward sale agreements: 40 million Class A common shares with initial forward price of $622.91875, settlement on or prior to November 19, 2027; 30-day option for underwriters to purchase up to 6 million additional shares
Concurrent offerings: The depositary shares offering and forward sale are not contingent upon each other
Underwriters: Morgan Stanley & Co. LLC and Goldman Sachs & Co. LLC serve as representatives for both offerings
Primary source
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