ON Semiconductor Corporation (Nasdaq: ONNN) today announced that it is exercising its option to redeem all remaining outstanding 1.875 percent Convertible Senior Subordinated Notes due in 2025 (CUSIP No. 682189AC9 and 682189AD7) (the "Notes") amounting to an aggregate principal amount of $95 million. The redemption date will be December 20, 2012. ON Semiconductor expects to fund the payment of this redemption using available liquidity.
The redemption price is equal to $1,000 per $1,000 principal amount of the Notes plus accrued and unpaid interest to, but excluding, the redemption date. Payment of the redemption price will be made upon surrender of the Notes at the address provided by the trustee of the Notes in the notice of redemption. A copy of the notice of redemption may be obtained from Deutsche Bank Trust Company Americas, as trustee and conversion agent, by calling 1-800-735-7777.
The holders of the Notes have the right to convert their Notes into shares of common stock of ON Semiconductor at a conversion rate of 142.8571 shares per $1,000 principal amount of Notes until the close of business on December 19, 2012. ON Semiconductor will satisfy its conversion obligation with respect to each $1,000 principal amount of Notes tendered for conversion by delivering cash equal to the sum of the daily conversion values, including cash for any net share amount. The observation period will include the 20 consecutive trading days beginning on and including the third trading day after the delivery of a conversion notice to the conversion agent. Holders who wish to convert their Notes must comply with the procedures in the Notes.
“We are pleased to announce the exercise of ON Semiconductor’s option to redeem $95 million of the 1.875 percent Convertible Senior Subordinated Notes,” said Bernard Gutmann, ON Semiconductor executive vice president and CFO. “ON Semiconductor began the fourth quarter of 2012 with ample cash, cash equivalents and short-term investments at approximately $643 million. With this redemption, ON Semiconductor will reduce its leverage and will eliminate future potential share dilution associated with the Notes.”