PHOENIX (AFX) - Chip maker ON Semiconductor Corp. said Monday it will offer $400 million of convertible senior subordinated notes in an institutional private placement.
The company said it expects to grant the initial purchasers an option to purchase up to an additional $60 million aggregate principal amount of the notes to cover possible overallotments.
ON Semiconductor plans to use the net proceeds of the offering to repay about $199.1 million outstanding under the term loan portion of its senior secured credit facility.
The company said it also plans to buyback up to $230 million, or about 30.3 million shares based on Friday's closing price of $7.58, of its common stock in privately-negotiated deals.
The buyback is conditioned upon the closing of the offering of the notes. Any remaining proceeds will be used for general corporate purposes, ON Semiconductor said.
ON Semiconductor shares closed down 8 cents at $7.50 on the Nasdaq.
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