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Investing.com -- Beyond Meat (NASDAQ:BYND) stock plunged over 60% on Monday after the plant-based meat maker announced an early settlement of its convertible debt exchange offer aimed at reducing its substantial debt load.
Nearly 97% of bondholders agreed to swap their existing 0% Convertible Senior Notes due 2027 for new 7.00% Convertible Senior Secured Second Lien PIK Toggle Notes due 2030 and shares of common stock. The company will issue approximately $208.7 million in new convertible notes and over 316 million new shares to settle the transaction early, with completion expected on October 15.
The exchange offer, launched in September, is part of Beyond Meat’s strategy to address more than $800 million in debt amid years of struggling sales. According to its latest annual filing, the company carried approximately $1.3 billion in debt as of December 31, 2024.
"We are pleased to announce this Early Settlement of the Exchange Offer for our Existing Convertible Notes, which marks a meaningful next step towards our goal of reducing leverage and extending debt maturity for Beyond Meat," said Ethan Brown, President and CEO of Beyond Meat.
The debt restructuring comes as the company continues to face challenges in the plant-based meat category. The massive stock dilution resulting from the issuance of hundreds of millions of new shares has triggered the sharp sell-off in the company’s shares.
As part of the agreement, holders of the new shares will face trading restrictions until October 16, 2025, though they may sell approximately 37.45% of the new shares received until that date.
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