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Chefs' Warehouse stock falls 9% after hours on $250M convertible note offering

  • Chefs' Warehouse (NASDAQ:CHEF) stock fell 8.8% after hours on Wednesday as the firm announced a $250M offering of its convertible senior notes due 2028 in a private placement to qualified institutional buyers.
  • The company will grant initial buyers of the notes an option to buy, for settlement within 13 days from, and including, the date of issue, up to an additional $37.5M of convertible notes.
  • The notes are expected to pay interest semiannually.
  • The convertible notes will mature on December 15, 2028, unless earlier converted, redeemed or repurchased.
  • Net proceeds will be used to pay the cash portion of the consideration in concurrent exchange deals and for general corporate purposes.
  • Concurrently with the offering, Chefs' Warehouse (CHEF) expects to enter into exchange deals with certain holders of its 1.875% convertible senior notes due 2024 to exchange a portion of outstanding existing convertible notes for a combination of cash and shares.