SanDisk (NASDAQ: SNDK ) is booting up an attempt to raise some capital. The company announced that it intends to float an issue of convertible senior notes in a private offering to qualified institutional buyers.
Up to $1 billion in principal amount will be issued in a series of notes maturing in 2020. The flash memory specialist also expects to grant the initial buyer an option to purchase up to an additional $150 million in principal amount to cover over-allotments.
The company said it intends to use its proceeds from the issue "to fund the cost of privately negotiated convertible note hedge transactions, which will serve to increase the effective conversion price of the convertible debt." It also aims to utilize some of the money to repurchase common stock from purchasers of notes in privately negotiated transactions, to repay debt, for strategic investments or acquisitions, to fund general stock repurchase initiatives, and for "other corporate purposes."
SanDisk said that Goldman Sachs will be the sole initial purchaser of the notes, which it will resell to qualified institutional buyers.
At the moment, SanDisk has just over 230 million shares of its common stock outstanding, which trade at $68.19 per share.