Vishay Intertechnology, Inc. (NYSE: VSH) today announced the closing of its offering of $150 million principal amount of 2.25% convertible senior debentures due 2042. The debentures were offered and sold only to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended.
Interest will be payable on the debentures semi-annually at a rate of 2.25% per annum. In addition to ordinary interest, beginning on June 1, 2022, contingent interest will accrue in certain circumstances relating to the trading price of the debentures and under certain other circumstances. The debentures will be initially convertible, subject to certain conditions, into cash, shares of Vishay’s common stock or a combination thereof, at Vishay’s option, at an initial conversion rate of 84.6937 shares of common stock per $1,000 principal amount of debentures. This represents an initial effective conversion price of approximately $11.81 per share. This initial conversion price represents a premium of 13.75% to the closing price of Vishay’s common stock on May 29, 2012, which was $10.38 per share.
Vishay may not redeem the debentures prior to June 7, 2022, except in connection with certain tax-related events. On or after June 7, 2022 and prior to the maturity date, Vishay may redeem for cash all or part of the debentures at a redemption price equal to 100% of the principal amount of the debentures to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date, if the last reported sale price of Vishay’s common stock has been at least 150% of the conversion price then in effect for at least 20 trading days during any 30 consecutive trading day period prior to the date on which Vishay provides notice of redemption.
Vishay used the net proceeds from this offering, together with cash on hand, to repurchase approximately 13.95 million shares of Vishay’s common stock for an aggregate purchase price of $150 million.