newsfilter
← Latest News
Business Wire·

Dropbox, Inc. Announces Upsize and Pricing of $1.1 Billion Convertible Senior Notes Offering

DBX
  • Dropbox priced $1.1 billion in aggregate principal amount of convertible senior notes due 2031, increasing the offering size from the previously announced $1.0 billion.
  • Initial purchasers received a 13-day option to buy up to an additional $150 million in Notes, with settlement expected on November 12, 2026.
  • Net proceeds are estimated at approximately $1.082 billion, or $1.23 billion if the option is fully exercised, after deducting discounts and expenses.
  • The Notes are senior, unsecured obligations bearing 1.25% annual interest, payable semi-annually on June 1 and December 1, beginning June 1, 2027.
  • Dropbox intends to use $103.1 million of proceeds for convertible note hedge transactions, $175 million to repurchase Class A common stock from institutional investors, and the remainder to repay at least $750 million of outstanding term loan borrowings.
  • The initial conversion rate is 24.5549 shares per $1,000 principal amount, equivalent to a conversion price of approximately $40.73 per share, representing a 25% premium over the November 9, 2026 stock price.
  • Notes are convertible at the option of noteholders only under specified conditions prior to September 1, 2031, and freely thereafter until maturity on December 1, 2031.
  • Dropbox may not redeem the Notes prior to December 5, 2029, except for a cleanup redemption if outstanding principal falls below $100 million.
  • Optional redemption is permitted on or after December 5, 2029, if the Class A common stock price exceeds 130% of the conversion price for at least 20 of 30 consecutive trading days.
  • Dropbox entered into private convertible note hedge and warrant transactions to offset dilution or reduce cash payments upon conversion, with warrant strike prices initially set at approximately $57.02 per share.
  • Option counterparties expect to purchase shares or enter derivative transactions concurrently with the offering, which may impact market prices of the stock or Notes.