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Investing.com -- Plug Power Inc. (NASDAQ:PLUG) stock tumbled 19% Wednesday after the hydrogen fuel cell maker announced the pricing of $375 million in convertible senior notes, with shares falling to $1.73 from Tuesday’s close of $2.14.
The company priced the 6.75% Convertible Senior Notes due 2033 at 95% of their principal amount in a private offering to qualified institutional buyers. Plug Power also granted initial purchasers a 13-day option to purchase up to an additional $56.25 million in notes.
Plug Power intends to use approximately $245.6 million of the net proceeds to fully repay its outstanding 15.00% secured debentures, and about $101.6 million, along with $52.4 million in cash on hand, to repurchase approximately $138 million of its 7.00% convertible senior notes due 2026.
The notes will be convertible at an initial rate of 333.3333 shares per $1,000 principal amount, equivalent to a conversion price of approximately $3.00 per share - a 40% premium to Tuesday’s closing price.
TD Cowen analyst Jeffrey Osborne, who maintains a Buy rating on Plug Power while lowering his price target to $4 from $4.50, noted: "Convert announced after the close, primarily to refi 15% debt, and is weighing on the stock."
The transaction is expected to close on November 21, 2025, subject to customary conditions, and should result in approximately $347.2 million in net proceeds after expenses.
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