BUZZ-Akamai Technologies shares fall after announcing $2.2 billion convertible bond issuance

November 9 - ** Cloud services company Akamai Technologies (AKAM.O) saw its share price fall by 7.3% in pre-market trading to $77 after reports that the company plans to raise capital.

** AKAM announced it will privately issue $1.1 billion in convertible bonds (CBs) maturing on November 15, 2028, and $1.1 billion in convertible bonds (CBs) maturing on November 15, 2031 (link).

** The company plans to use the net proceeds from this issuance to repay part of the $1.15 billion outstanding convertible bonds due in 2027 with a coupon rate of 0.375% at maturity, pay cash owed from early conversion of the 2027 convertible bonds, and fund capital expenditures for its cloud infrastructure services business.

** The company also plans to use part of the raised funds to pay for the costs of convertible bond hedge transactions.

** AKAM, headquartered in Cambridge, Massachusetts, has a market capitalization of around $12 billion.

** As of Friday's close, the company's share price had fallen about 5% year-to-date, while the S&P 500 Technology Index (.SPLRCT) rose by about 11%, and the Nasdaq Index (.IXIC) climbed nearly 6%.

** According to data from London Stock Exchange Group (LSEG), the average rating from 25 institutions is “buy”; the median target price is $120, down from $155.39 a month ago.

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