AST SpaceMobile Moves to Fund Convertible Note Repurchase
Prices Repurchase of Convertible Notes and Registered Direct Offering of Class A Common Stock
AST SpaceMobile has announced the pricing of a cash repurchase (the “Repurchase”) of $225 million aggregate principal amount of its 4.25% convertible notes due 2032 (the “2032 convertible notes”) pursuant to separate, privately negotiated repurchase transactions with a limited number of holders of the 2032 convertible notes and a registered direct offering of 9,450,268 shares of its Class A common stock to holders of 2032 convertible notes participating in the Repurchase in a direct placement registered under the Securities Act of 1933, as amended (the “Registered Direct Offering”).
"These transactions allow us to substantially reduce our outstanding debt and cash interest obligations.”
Scott Wisniewski, AST SpaceMobile
With this series of transactions, AST SpaceMobile, Inc. will issue approximately 1.04 million incremental shares to the underlying shares of the 2032 convertible notes being repurchased while removing $225 million of debt from the balance sheet and approximately $63.8 million of remaining interest. Both the closing of the Repurchase and the Registered Direct Offering are expected to take place on or about July 1, 2025. The transactions are cross-conditional.
“We are excited to retire approximately half of our 2032 convertible notes and the underlying shares at a price attractive to our shareholders in a series of innovative transactions. These transactions allow us to substantially reduce our outstanding debt and cash interest obligations,” said Scott Wisniewski, AST SpaceMobile president.
AST SpaceMobile intends to use the net proceeds from the Registered Direct Offering of 9,450,268 shares to fund the repurchase of $225 million aggregate principal amount of the 2032 convertible notes. After giving effect to the Repurchase, $235 million aggregate principal amount of the 2032 convertible notes will remain outstanding.
Based on the initial conversion rate of 37.0535 shares of Class A Common Stock per $1,000 principal amount of 2032 convertible notes, which is subject to customary anti-dilution adjustment provisions, 8,337,037 shares of Class A common stock underlying the repurchased 2032 convertible notes will be unreserved after giving effect to the Repurchase and will be available for future issuance.
As part of the Repurchase, AST SpaceMobile did not terminate or amend the previously purchased capped call which will remain outstanding upon the completion of this transaction. The capped call is expected to reduce dilution and/or offset cash payments upon a conversion of 2032 convertible notes.
Holders of the 2032 convertible notes that participate in any of these repurchases may purchase or sell shares of AST SpaceMobile’s Class A common stock in the open market to unwind any hedge positions they may have with respect to the 2032 convertible notes or to hedge their exposure in connection with these transactions. These activities may affect the trading price of AST SpaceMobile’s Class A common stock.
AST SpaceMobile has agreed to sell an aggregate of 9,450,268 shares of its Class A common stock in the Registered Direct Offering at a price of $53.22 per share to holders of the 2032 convertible notes participating in the Repurchase.
The Registered Direct Offering, or placement, is being made pursuant to an effective shelf registration statement on file with the Securities and Exchange Commission (the “SEC”). The placement will be made only by means of a prospectus supplement and an accompanying prospectus. An electronic copy of the prospectus supplement, together with the accompanying prospectus, is available on the SEC’s website at www.sec.gov. Alternatively, copies of the prospectus supplement, together with the accompanying prospectus, can be obtained by contacting: AST SpaceMobile, Inc., Midland International Air & Space Port, 2901 Enterprise Lane, Midland, Texas 79706, Attention: Secretary or (432) 276-3966.
UBS Investment Bank is acting as placement agent and financial advisor and ICR Capital LLC is acting as financial advisor for the placement.