Semtech shares fell to lows not seen since 2015 after the chipmaker and IoT solutions provider told investors it plans to take on $250 million in new debt.
The company said Thursday that it intends to offer $250 million in convertible senior notes due in 2028.
The proceeds of the offering, together with cash on hand, will be used to prepay outstanding loans under its senior credit facilities.
Semtech already has about $1.4 billion in debt on its books and its move to take on more debt to meet its existing obligations spooked investors.
Its shares were down 20.7% at US$15.80 shortly before noon on Thursday, an eight-year low.
Semtech stock is down about 45.4% in the year-to-date.
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