Benzinga | Jun 22, 2021 09:18AM EDT

Splunk Raises $1B Via Convertible Senior Notes Sale To Silver Lake, Announces $1B Stock Buyback, Launches New Security Cloud

* Splunk Inc (NASDAQ:SPLK) announced that technology-focused private equity firm Silver Lake would make a $1 billion investment in senior convertible notes to support its continued business transformation.

* The notes will have an initial conversion price of $160 per share of Splunk, implying a 30% premium to the volume-weighted average closing price over ten days ending on June 21. The notes will mature in July 2026 and bear annual interest at 0.75%.

* Splunk will utilize the proceeds to fund growth initiatives and manage its capital structure, including a newly authorized share buyback program of up to $1 billion.

* Silver Lake Chairman and Managing Partner Kenneth Hao will join Splunk's board under the arrangement.

* Separately, Splunk announced the new Splunk Security Cloud, a data-centric modern security operations platform that will help the teams secure and manage multi-cloud deployments while remaining alert to adapt to ever-evolving threats.

* Price action: SPLK shares traded higher by 8.96% at $136.74 in the premarket session on the last check Tuesday.