Viavi Solutions issues $250 million in convertible notes due 2031

Viavi Solutions Inc. (NASDAQ:VIAV), a technology company with a market capitalization of $2.46 billion and strong financial health metrics according to InvestingPro, announced Monday it has issued $250 million in aggregate principal amount of 0.625% Senior Convertible Notes due 2031. The company, which has maintained a healthy current ratio of 1.5x and generated $62 million in free cash flow over the last twelve months, is currently rated ’FAIR’ by InvestingPro’s comprehensive financial health assessment. The issuance was completed August 20, according to a statement based on a filing with the Securities and Exchange Commission.

Of the total, approximately $100.9 million in new notes were exchanged for about $97.5 million of the company’s outstanding 1.625% Senior Convertible Notes due 2026. The remaining $149.1 million in new notes were sold for cash to institutional accredited investors and qualified institutional buyers in privately negotiated transactions.

The new notes will mature on March 1, 2031, unless earlier converted, redeemed, or repurchased. They are unsecured, unsubordinated obligations, ranking equally with the company’s other unsecured debt, including any 2026 notes not exchanged.

Interest on the notes is payable at an annual rate of 0.625%, in cash, semiannually on March 1 and September 1, starting March 1, 2026. Holders may convert the notes into cash and shares of Viavi Solutions common stock at an initial conversion rate of 72.5295 shares per $1,000 principal amount, reflecting a conversion price of approximately $13.79 per share. This represents a 25% premium over the $11.03 closing price of the company’s stock on August 13, 2025. Up to 22,665,450 shares may be issued upon conversion, subject to anti-dilution adjustments.

The company received and cancelled the exchanged 2026 notes and expects to use net proceeds from the cash sale to repay a portion of the 2026 notes at maturity.

The notes may be converted or redeemed under certain conditions outlined in the indenture and are subject to customary events of default. Viavi Solutions may not redeem the notes before September 6, 2028, and may only redeem them after that date if its stock price meets specified thresholds.

This information is based on a press release statement included in the company’s recent SEC filing.

In other recent news, Viavi Solutions has announced a $250 million offering of 0.625% Senior Convertible Notes due 2031. This move includes exchanging approximately $100.9 million in new notes for $97.5 million of existing notes due 2026, alongside selling around $149.1 million in new notes for cash. Viavi Solutions also reported strong fourth-quarter results for fiscal year 2025, with revenues reaching $290 million, marking a 15% year-over-year increase. The company’s earnings per share stood at $0.13, surpassing the forecasted $0.12 and exceeding revenue expectations of $285.18 million. Following these results, Susquehanna upgraded Viavi Solutions from Neutral to Positive, citing potential earnings per share of $0.80 or higher due to AI fiber demand. Rosenblatt Securities also raised its price target for the company to $15.00, maintaining a Buy rating based on the robust quarterly results and guidance. These developments underscore the company’s strong performance and the positive outlook from analysts.

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