BUZZ-Snowflake announces issuance of $3.5 billion 0% convertible bonds, stock price declines

September 28 - ** Artificial intelligence cloud computing company Snowflake SNOW.N saw its share price fall 5% to $319.21 in pre-market trading on Monday as the company seeks to raise funds to repay part of its debt

** Headquartered in Menlo Park, California, SNOW (link) is conducting a private placement of $1.3 billion in convertible bonds with a coupon rate of 0% maturing on October 15, 2029, and $2.2 billion in convertible bonds with a coupon rate of 0% maturing on October 15, 2031

** The company plans to use the net proceeds from this issuance to repurchase its 0% convertible bonds due in 2027

** It also intends to use part of the raised funds for stock buybacks, mergers and acquisitions or investments, and to fund capped call transactions to offset potential dilution effects

** The company has a market capitalization of approximately $118.5 billion

** As of Friday's close, SNOW's share price had risen 53% so far this year, including a 10% increase since September 2 when the company raised its annual revenue forecast (link), driven by growing demand for its cloud data platform and artificial intelligence products

** According to LSEG data, the average rating from 51 analysts covering the stock is “buy”; the median target price has risen from $322.50 a month ago to $448.50

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