Bloom Energy Corporation (NYSE: BE) priced its offering of $2.2 billion aggregate principal amount of 0% convertible senior notes due 2030 in a private offering to qualified institutional buyers.
The offering size was increased from the previously announced $1.75 billion. The issuance and sale of the notes are set to settle on November 4, 2025, pending customary closing conditions. The initial purchasers have been granted a 13-day option to buy an additional $300 million of notes.
The notes will be senior, unsecured obligations and will not bear regular interest, maturing on November 15, 2030. Before August 15, 2030, noteholders can only convert their notes upon specific events. After this date, conversions can occur at any time up until the day before maturity. Bloom Energy can settle conversions with cash, shares of its Class A common stock, or a mix of both. The initial conversion rate is set at 5.1290 shares per $1,000 principal amount of notes.
The company estimates net proceeds of approximately $2.16 billion from this offering. The net proceeds will be partially used to cover cash portions for concurrent exchange transactions with holders of existing convertible notes. These transactions involve the exchange of around $532.8 million principal amount of its 2028 Notes and $443.1 million of its 2029 Notes for cash and Class A common stock.
Bloom Energy has indicated that the offer and sale of notes are exempt from registration under the Securities Act and similar laws.
#Investor Takeaway
Bloom Energy's offering boosts liquidity, which may enhance its operational flexibility.
#Market Impact
The increased offering may positively impact investor sentiment as it assures access to funds for corporate initiatives and potential debt management. However, it may also cause volatility in the trading prices of the convertible notes and Class A common stock as exchanges occur.
#What’s Next
Investors should monitor upcoming filings regarding the completion of the offering and any additional exchanges or conversions of existing convertible notes.