Unity closed a $690.0 million convertible notes offering on Feb 27, 2025 and used about $600.0 million to repurchase 2026 notes

Written by Claude Sonnet 5.5, an AI model, from public records. Each figure in it was checked automatically against the source's text or our database before it was published.

Unity Software Inc. completed a private offering of $690.0 million of 0% convertible senior notes due 2030 on Feb 27, 2025, including a $90.0 million option that the initial purchasers, who bought the notes from Unity to resell them, exercised in full. Convertible notes are debt that holders can swap for shares: these carried no regular interest, and Unity could settle a conversion in cash, shares or both. Unity reported the deal in an 8-K, the filing a US-listed company makes when something material happens, under items 1.01 (a material agreement), 2.03 (a new financial obligation), 3.02 (an unregistered sale of equity securities) and 8.01 (other events).1^,2^,3^,4^,5

Net proceeds were about $675.0 million after the initial purchasers' discounts and commissions and estimated offering expenses. Unity used about $600.0 million of that to repurchase about $644.3 million of principal of its 0% convertible senior notes due 2026, in private deals with certain holders of those notes, and about $44.4 million to pay for capped call transactions. Unity said it intended to cancel the repurchased notes, after which about $600.9 million of the 2026 notes would remain outstanding. It expected to use the rest for general corporate purposes, which could include repurchasing more of the 2026 notes.6^,7^,8^,9^,10

The new notes were general unsecured debt due on Mar 15, 2030 unless converted, redeemed or repurchased earlier, and Unity could not redeem them before Mar 20, 2028. They were convertible initially at about $36.15 a share, a premium of about 32.5% to the last reported sale price of $27.28 on the New York Stock Exchange on Feb 24. Up to 25,293,192 shares could be issued on conversion at the initial maximum conversion rate. The capped call transactions were expected generally to reduce the dilution from a conversion or to offset cash payments above the principal of converted notes, up to a cap price initially set at $47.74 a share.11^,12^,13^,14^,15^,16^,17

Unity proposed a $500.0 million offering on Feb 24, 2025, and announced it priced at an upsized $600.0 million the same day, with an option for the initial purchasers to buy up to $90.0 million more. Unity sold the notes to the initial purchasers for resale to persons reasonably believed to be qualified institutional buyers under Rule 144A, an exemption from registration.18^,19^,20^,21^,22^,23^,2^,24

Unity described itself as the leading platform to create and grow games and interactive experiences.25

This article draws on the 8-K and its press releases; the indenture is Exhibit 4.1 to the filing and is not among the documents behind this article.26