Mitek hedges against biometrics investment market disruption with $125M private offering
Mitek is planning to raise at least $125 million through a private offering of Convertible Senior Notes to qualified institutional investors as it hedges against uncertain financial conditions, even amid robust sales of its biometrics and mobile digital transactions technology.
The establishment of convertible note hedge transactions and warrant transactions by Mitek is expected to be followed by agreements on various derivative transactions related to the company’s common stock.
Initial purchasers will also be granted options to purchase up to $18.75 million in additional notes.
The notes accrue interest, which is payable semi-annually, and mature February 1, 2026, if not already repurchased or converted. The terms of the notes, including the interest and conversion rate, will be determined when the offering is priced.
Mitek says it will use the net proceeds from the offering to pay for the convertible note hedge transactions, which will have been partially offset by proceeds from the warrant transactions. If the options for additional notes are exercised, the company plans to use a portion of the funds to form agreements for additional convertible note hedge transactions and warrant transactions, according to the announcement. Remaining net proceeds will be used for general corporate purposes, like working capital or strategic transactions.