JetBlue Airways Corp. (JBLU) has announced the pricing of $400 million in aggregate principal amount of its 2.50% convertible senior notes, set to mature in 2029. The airline has also granted initial purchasers an option to buy an additional $60 million in aggregate principal amount of these notes.
The transaction is expected to close around August 16, 2024.
Under certain conditions before June 1, 2029, and at any time until the close of business on the second scheduled trading day preceding the maturity date, these notes can be converted. The initial conversion price is approximately $6.12 per share of JetBlue's common stock, which is about a 27.5% premium over the closing price of $4.80 per share on The NASDAQ Global Select Market as of August 12, 2024.
JetBlue has stated that it does not intend to redeem the notes before September 1, 2027. However, starting from that date and until the 45th scheduled trading day before the maturity date, the company reserves the option to redeem all or part of the notes, subject to certain conditions.
The net proceeds from this offering are planned to be used to repurchase a portion of JetBlue's existing 0.50% senior convertible notes due 2026 and to cover fees and expenses related to the offering. Any additional net proceeds from the exercise of the initial purchasers' option to buy more notes will be allocated for general corporate purposes.
