BlackSky to offer $125 million in convertible senior notes

HERNDON, Va. - BlackSky Technology Inc. (NYSE:BKSY), which has seen its stock surge over 140% year-to-date according to InvestingPro data, announced Thursday it plans to offer $125 million in Convertible Senior Notes due 2033 to qualified institutional buyers in a private offering under Rule 144A of the Securities Act.

The space-based intelligence company, which maintains impressive gross profit margins of 69% and operates with a moderate level of debt, also intends to grant initial purchasers an option to buy up to an additional $18.75 million in notes during a 13-day period following the initial issuance.

The notes will be unsecured obligations with semiannual interest payments. Upon conversion, BlackSky may settle in cash, shares of its Class A common stock, or a combination of both, at its discretion. Specific terms including interest rate and conversion rate will be determined at pricing.

BlackSky plans to use approximately $103.1 million of the proceeds to repay outstanding borrowings and terminate its secured term loan facility. An additional $10.2 million will go toward repaying and terminating its secured revolving credit facility. The remainder will fund general corporate purposes, including working capital, operating expenses, and capital expenditures. According to InvestingPro analysis, the company maintains a healthy current ratio of 3.79, indicating strong short-term liquidity position.

Neither the notes nor any shares issuable upon conversion have been registered under the Securities Act or state securities laws, limiting their offer and sale in the United States.

BlackSky operates a commercial real-time intelligence system combining its proprietary low earth orbit satellite constellation with its SpectraⓇ tasking and analytics software platform. The company is headquartered in Herndon, Virginia. For detailed insights into BlackSky’s financial health and growth prospects, including 18 additional ProTips and comprehensive valuation metrics, visit InvestingPro’s detailed research report.

The announcement was made in a press release statement from the company.

In other recent news, BlackSky Technology Inc. announced a $125 million convertible notes offering intended to repay existing borrowings and fund general corporate purposes. This financial move involves unsecured notes with semiannual interest payments, and the company retains the discretion to settle conversions in cash, stock, or both. Additionally, BlackSky secured a multimillion-dollar contract with a new international client for satellite imagery services, extending through 2029. The agreement includes modernizing the client’s ground segment and access to BlackSky’s AI-enabled tasking platform. In a separate development, BlackSky renewed a contract with an existing international customer, enhancing their services with Gen-3 satellite imagery capabilities. Analyst firms have responded positively to BlackSky’s technological advancements. H.C. Wainwright raised its price target for BlackSky to $28, citing expected revenue growth driven by Gen-3 satellite deployments and geopolitical factors. Similarly, Canaccord Genuity increased its price target to $20, highlighting the strong performance of BlackSky’s Gen-3 satellites and anticipating increased demand from defense sectors. These developments reflect BlackSky’s strategic financial and operational initiatives in response to evolving market dynamics.

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