HAWTHORNE, Calif. - OSI Systems , Inc. (NASDAQ: NASDAQ:OSIS), a provider of specialized electronic systems and components, announced its intention to offer $275 million in convertible senior notes due in 2029, with an additional option for initial purchasers to buy up to $41.25 million more within 13 days of issuance.
The notes, set to mature on August 1, 2029, will be senior, unsecured obligations of OSI, accruing interest payable semi-annually. They will be redeemable at OSI's discretion after August 6, 2027, under certain conditions, including the company's stock price exceeding 130% of the conversion price. In the event of specific corporate changes, noteholders may require OSI to repurchase their notes at the principal amount plus accrued interest.
Concurrently with the offering, OSI plans to repurchase up to $100 million of its common stock in privately negotiated transactions. The remaining net proceeds are intended for repaying part of its outstanding revolving credit facility, covering related fees and expenses, and for general corporate purposes. These concurrent stock repurchases could potentially impact OSI's common stock trading prices and the initial conversion price of the notes.
The offering and any common stock convertible from the notes will not be registered under the Securities Act of 1933 or any other securities laws and will be available only to qualified institutional buyers.
OSI Systems operates in the homeland security, healthcare, defense, and aerospace sectors, leveraging over 40 years of experience with a global presence.
This news is based on a press release statement.
In other recent news, OSI Systems has secured several significant contracts across various sectors. The company has obtained a $7 million order from a prominent aerospace and defense original equipment manufacturer to supply navigation sensors. In addition, OSI Systems has secured an $11 million contract to supply radiation monitoring portals to an international client, accompanied by related services and support.
The company also announced a $42 million contract for enhancing security measures at an international airport, including the provision and maintenance of advanced screening technologies.
Furthermore, OSI Systems has made strides in the healthcare sector with a $7 million order to supply portable health monitoring devices to a leading provider of diagnostic solutions. The company also revealed a $9 million order from an international client for its Eagle® M60 high-energy mobile cargo and vehicle inspection systems, marking the beginning of a multi-year agreement.
Lastly, a $6 million order was received for electronic assemblies from an original equipment manufacturer. These recent developments reflect OSI Systems' ongoing business activities across multiple sectors.
InvestingPro Insights
As OSI Systems, Inc. (NASDAQ: OSIS) ventures into the market with its significant offering of convertible senior notes, the company's financial health and stock performance are critical for potential investors. According to InvestingPro data, OSI Systems boasts a robust market capitalization of $2.49 billion, reflecting investor confidence in the company's value and stability.
InvestingPro Tips highlight OSI Systems' attractive position with a low P/E ratio of 19.68 relative to near-term earnings growth, suggesting that the company could be undervalued based on its earnings outlook. Moreover, the company has experienced a significant return over the last week, with a 7.63% price total return, indicating a strong short-term performance that may catch the eye of active investors.
With OSI Systems trading near its 52-week high at 99.12% of the peak price, and analysts predicting profitability for the current year, the company's strategic financial maneuvers, such as the convertible notes offering and concurrent stock repurchase, seem to be well-timed to capitalize on its positive momentum.
Investors considering OSI Systems as part of their portfolio can explore additional InvestingPro Tips for a comprehensive analysis. There are currently 6 more tips available on InvestingPro, which can provide deeper insights into the company's financials and market performance. To access these tips and more detailed metrics, visit https://www.investing.com/pro/OSIS.
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