Avnet Raises $650M in Convertible Debt Offering

Avnet has priced a $550M convertible debt offering, with an option to purchase up to an additional $100M. The notes will bear interest at 1.75% per year and mature in 2030. The offering is part of Avnet's strategy to raise capital for its business.

Avnet, Inc. (Nasdaq: AVT) has priced a $550 million convertible debt offering, with an option to purchase up to an additional $100 million. The notes, which will bear interest at 1.75% per year, are due in 2030. The offering is part of Avnet's strategy to raise capital for its business operations [1].

The notes, which are senior unsecured obligations, will mature on September 1, 2030, unless they are converted, redeemed, or repurchased earlier. The initial conversion rate is 14.2313 shares of common stock per $1,000 principal amount, representing a conversion price of approximately $70.27 per share. This conversion rate is a 35% premium over Avnet's last reported share price of $52.05 on September 2, 2025 [1].

Avnet expects to use approximately $100 million from the offering to repurchase about 1.92 million shares of its common stock concurrently with the pricing. The remaining proceeds will go toward repaying a portion of its revolving credit facility. The offering is expected to close around September 5, 2025, subject to customary closing conditions [1].

The notes will not be redeemable before September 8, 2028. After that date, they may be redeemed under certain conditions, including if Avnet's stock price exceeds 130% of the conversion price for a specified period [2].

Avnet's recent fourth-quarter 2025 earnings report showed earnings per share of $0.81, surpassing analyst expectations, and revenue of $5.6 billion, which also exceeded forecasts. However, Fitch Ratings revised Avnet's outlook to negative from stable due to elevated leverage, noting an EBITDA leverage of 3.7x as of June 28, 2025 [1].

References:
[1] https://www.investing.com/news/company-news/avnet-prices-550-million-convertible-senior-notes-due-2030-93CH-4220689
[2] https://timestech.in/avnet-announces-pricing-of-upsized-convertible-senior-notes-offering/