Ubisoft Shares Tumble After Bond Placement -- Update
28 Novembre 2023 - 12:10PM
Dow Jones News
By Helena Smolak and Mauro Orru
Shares of Ubisoft Entertainment slumped after the maker of the
Assassin's Creed videogame franchise placed bonds convertible or
exchangeable into shares to bolster its financial flexibility,
refinance existing debt, and to fund repurchase of shares.
At 1025GMT, Ubisoft shares traded 9% lower at EUR26.75. Shares
opened at EUR27.35.
Ubisoft said Tuesday that it had raised 494.5 million euros
($541.7 million) from the placement. The bonds have a Dec. 5, 2031
maturity date, a 2.875% coupon and a 47.5% conversion premium.
"While the new bond comes with a higher coupon and entails up to
9.6% dilution assuming full conversion, it extends the weighted
average maturity of Ubisoft's balance sheet at a reasonable cost,"
Citi analysts wrote in a research note.
Shares were expected to open roughly 7% down at €27.35 after the
placement, the analysts said, "but the incremental comfort it gives
on the risk profile, over time, we think will be well
received."
Ubisoft plans to use about half of the funds it raised to
repurchase up to EUR250 million in shares.
Write to Helena Smolak at helena.smolak@wsj.com and Mauro Orru
at mauro.orru@wsj.com
(END) Dow Jones Newswires
November 28, 2023 05:55 ET (10:55 GMT)
Copyright (c) 2023 Dow Jones & Company, Inc.
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