Super Micro drops after planned $2 bln convertible bonds sale unveiled

Shares of AI server maker Super Micro Computer SMCI.O down 3.9% before the bell to $43.54 as it looks to raise capital

San Jose, California-based SMCI announces private offering of $2 bln 5-yr convertible bonds (CBs)

It plans to use portion of net proceeds to fund capped calls, derivative transactions employed to mitigate shareholder dilution, and up to $200 mln to repurchase its shares from the CB buyers

Co says remaining proceeds to be used for general purposes, including to fund working capital for growth and business expansion

SMCI, which makes high-performance servers featuring chips from AI-darling Nvidia NVDA.O, among other chipmakers, has $27 bln market cap

SMCI shares on Fri closed up 1.9% at $45.32, up ~49% YTD

Of 18 analysts covering SMCI, recommendation breakdown is 7 "buy", 9 "hold" and 2 "sell"'; median PT of $37 unchanged from last month but down from $54.50 on Apr 23, LSEG data reflects