IT firm Xero launches $850 million convertible notes offering due 2031

By Thomson Reuters Jun 4, 2024 | 3:30 AM

(Reuters) – Software service company Xero on Tuesday announced it is raising $850 million by offering fixed coupon guaranteed senior unsecured convertible notes that are due to be repaid by 2031.

The move follows a recent surge in convertible bond offerings, including deals from Alibaba worth $4.5 billion and notable issues from Lenovo and JD.com amounting to $2 billion and $1.5 billion, respectively.

On Monday, Bloomberg News reported that Chinese developer Poly Developments and Holdings Group was considering a sale of convertible bonds worth $1.7 billion.

Xero said in its statement that it plans to list the notes on the Singapore stock exchange.

The net proceeds will be used to repurchase its existing notes and for potential acquisitions and investments, the IT firm added.

Xero said that its subsidiary, Xero Investments, was conducting a reverse bookbuilding process to attract investors for the company’s $700 million buyback programme of existing convertible bonds.

(Reporting by Poonam Behura in Bengaluru; Editing by Eileen Soreng)