SAN JOSE, Calif.--(BUSINESS WIRE)--
Western Digital Corporation (NASDAQ: WDC) ("Western Digital" or the
"company") today announced that it has priced its concurrent offerings
of $2.3 billion aggregate principal amount of senior unsecured notes due
2026 (the "2026 notes") and $1.0 billion aggregate principal amount of
convertible senior notes due 2024 (the "2024 convertible notes" and,
together with the 2026 notes, the "notes"). The notes will be issued by
Western Digital, and guaranteed, jointly and severally on a senior
basis, by certain of Western Digital's subsidiaries.
The 2026 notes were offered in a public offering, and will bear interest
at a rate of 4.750% per annum. Western Digital intends to use the net
proceeds of the 2026 notes offering, together with available cash on
hand, to fund its concurrent cash tender (the "tender offer") to
purchase any and all of its currently outstanding 10.500% senior
unsecured notes due 2024. BofA Merrill Lynch and J.P. Morgan Securities
LLC are acting as lead book-running managers, and RBC Capital Markets,
Mizuho Securities and Wells Fargo Securities are acting as book-running
managers for the 2026 notes offering.
The 2024 convertible notes were offered in a private offering to only
qualified institutional investors ("QIBs") in accordance with Rule 144A
under the Securities Act of 1933, as amended (the "Securities Act"), and
will bear interest at a rate of 1.50% per annum. The company granted the
initial purchasers a 30-day option to purchase up to an additional $100
million aggregate principal amount of 2024 convertible notes. The
company intends to use the net proceeds of the offering of the 2024
convertible notes, together with the net proceeds from the previously
announced Term Loan A-1 facility and available cash on hand, to redeem
all of its currently outstanding 7.375% senior secured notes due 2023
(the "2023 secured notes"), including all accrued interest, related
premiums, fees, and expenses. The 2024 convertible notes will be
convertible into cash, shares of Western Digital's common stock or a
combination thereof, at Western Digital's election, at an initial
conversion price of approximately $121.91 per share (which represents a
premium of approximately 40% to the $87.08 per share closing price of
Western Digital's common stock on Jan. 30, 2018). The company may redeem
all or part of the 2024 convertible notes, at its option, on or after
Feb. 5, 2021 if the company's common stock price has been at least 130%
of the conversion price for at least 10 trading days out of a 20-day
consecutive trading period.
The company agreed to repurchase approximately $153.5 million of its
common stock concurrently with the offering of the 2024 convertible
notes offering in privately negotiated transactions, at a purchase price
per share equal to the $87.08 per share closing price of Western
Digital's common stock on Jan. 30, 2018 with available cash on hand.
The sale of both the 2026 notes and the 2024 convertible notes is
expected to be completed on Feb. 13, 2018, subject to customary closing
conditions.
The 2024 convertible notes, the common stock, if any, deliverable upon
conversion of the 2024 convertible notes and the related guarantees have
not been and will not be registered under the Securities Act or the
securities laws of any other jurisdiction. They may not be offered or
sold in the United States or to, or for the benefit of, U.S. persons
absent registration under, or an applicable exemption from, the
registration requirements of the Securities Act.
The 2026 notes and 2024 convertible notes offerings are being conducted
as separate offerings. Neither offering is contingent upon the other.
The company has filed a registration statement (including a prospectus)
with the Securities and Exchange Commission (the "SEC") for the 2026
notes offering. Before you invest, you should read the prospectus in the
registration statement and other documents the company has filed with
the SEC for more complete information about the company and the
offerings. You may obtain these documents for free by visiting EDGAR on
the SEC website at www.sec.gov,
from BofA Merrill Lynch, NC1-004-03-43, 200 North College Street, 3rd
floor, Charlotte, NC 28255-0001, Attn: Prospectus Department, or by
email at dg.prospectus_requests@baml.com
or from J.P. Morgan Securities LLC via Broadridge Financial Solutions,
1155 Long Island Avenue, Edgewood, New York 11717, or by telephone at
(866) 803-9204.
This press release does not constitute an offer to sell or a
solicitation of an offer to buy the common stock, notes or any other
security, nor will there be any sale of the common stock, notes or any
other security in any state or jurisdiction in which such an offer,
solicitation or sale is not permitted. Any offer or sale will be made
only by means of a prospectus and, to the extent applicable, a free
writing prospectus which has or will be filed with the SEC.
About Western Digital
Western Digital creates environments for data to thrive. The company is
driving the innovation needed to help customers capture, preserve,
access and transform an ever-increasing diversity of data. Everywhere
data lives, from advanced data centers to mobile sensors to personal
devices, our industry-leading solutions deliver the possibilities of
data. Western Digital® data-centric solutions are marketed
under the G-Technology™, HGST, SanDisk®, Tegile™, Upthere™
and WD® brands. Financial and investor information is
available on the company's Investor Relations website.
Forward-Looking Statements
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995,
including statements concerning the offering of senior notes. These
forward-looking statements are based on management's current
expectations and are subject to risks and uncertainties that could cause
actual results to differ materially from those expressed or implied in
the forward-looking statements, including: volatility in global economic
conditions; uncertainties with respect to the company's business
ventures with Toshiba; business conditions and growth in the storage
ecosystem; impact of competitive products and pricing; market acceptance
and cost of commodity materials and specialized product components;
actions by competitors; unexpected advances in competing technologies;
the development and introduction of products based on new technologies
and expansion into new data storage markets; risks associated with
acquisitions, mergers and joint ventures; difficulties or delays in
manufacturing; impacts of new tax legislation; and other risks and
uncertainties listed in the company's filings with the SEC, including
the company's Form 10-Q filed with the SEC on Nov. 7, 2017, to which
your attention is directed. You should not place undue reliance on these
forward-looking statements, which speak only as of the date hereof, and
the company undertakes no obligation to update these forward-looking
statements to reflect new events.
Western Digital, the Western Digital logo, G-Technology, HGST, SanDisk,
Tegile, Upthere and WD are registered trademarks or trademarks of
Western Digital Corporation or its affiliates in the U.S. and/or other
countries.
View source version on businesswire.com: http://www.businesswire.com/news/home/20180130006545/en/
Western Digital Corp.
Media Contact:
Jim Pascoe
408.717.6999
jim.pascoe@wdc.com
or
Investor
Contact:
Bob Blair
949.672.7834
robert.blair@wdc.com
Source: Western Digital Corporation
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