OpenText Announces Conditional Notice of Redemption of its Outstanding 2027 Notes and Potential Offering of Senior Secured Notes
OpenText (OTEX) has issued a conditional notice to redeem all $1.0 billion of its outstanding 6.900% Senior Secured Notes due 2027 on October 2, 2026, subject to a financing condition.
Rhea-AI Summary
OpenText (OTEX) has issued a conditional notice to redeem all $1.0 billion of its outstanding 6.900% Senior Secured Notes due 2027 on October 2, 2026, subject to a financing condition.
The redemption price will be the greater of 100% of principal or a make-whole amount based on the present value of remaining payments at the applicable treasury rate plus 50 basis points, less accrued interest, plus accrued and unpaid interest to (but excluding) the redemption date. OpenText is exploring a potential Rule 144A/Regulation S senior secured notes offering and expects to use net proceeds to fund the redemption, premiums, interest and related costs, with any remaining proceeds for general corporate purposes, including repurchase or repayment of other debt.
Positive
- $1.0 billion of 6.900% 2027 notes targeted for full redemption
- Potential new senior secured notes could fund redemption and related costs
- Remaining proceeds from any offering earmarked for general corporate purposes, including debt repayment
Negative
- Redemption is conditional on a financing requirement and may not occur as described
- Any senior secured notes offering would add new secured debt to the capital structure
News Explained
If the financing condition is met or waived and the redemption occurs on
Key Figures
- 2027 Notes Principal
- $1.0 billion
- Outstanding 6.900% senior secured notes subject to conditional redemption
- Coupon Rate
- 6.900%
- 2027 senior secured notes
- Redemption Date
- October 2, 2026
- Conditional full redemption of the 2027 Notes
- Minimum Redemption Price
- 100% of principal amount
- Greater-of formula for the Redemption Amount
- Treasury Spread
- 50 basis points
- Added to the treasury rate in the present-value calculation
Historical Context
-
Reported long-term debt reduction to $5.73 billion in fiscal 2026 results.
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
AI-generated analysis. How Rhea-AI works. Not financial advice.
The redemption price for the 2027 Notes (the "Redemption Amount") is equal to the greater of (A)
The Company is also exploring a potential offering of senior secured notes pursuant to Rule 144A ("Rule 144A") and Regulation S ("Regulation S") under the Securities Act of 1933, as amended (the "Securities Act"). The Company expects to use the net proceeds from any such offering to fund the redemption of the 2027 Notes, including the payment of the applicable redemption premium, accrued and unpaid interest and related costs and expenses, and, to the extent that the financing condition is otherwise met or waived, the Company may elect to use cash on hand to fund a portion of such amounts. The Company expects any remaining net proceeds from the potential offering will be used for general corporate purposes, which may include any method of repurchase or repayment of our outstanding debt.
This press release shall not constitute a notice of redemption under the indenture governing the 2027 Notes, and such redemption is subject to the conditions set forth in the applicable notice of redemption, including the Financing Condition. Such notice has been made only in accordance with the provisions of the indenture governing the 2027 Notes. There can be no assurances as to whether any such redemption will be effected as described above.
This press release shall not constitute an offer to sell, or the solicitation of an offer to buy, nor shall there be any sale of, the senior secured notes (if such offering proceeds) in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, qualification or exemption under the securities laws of any such jurisdiction. Any such notes offering will not be registered under the Securities Act. Any such notes may not be offered or sold within
OTEX-F
About OpenText
OpenText™ is a global leader in data management for enterprise AI, helping organizations protect, govern, and activate their data with confidence. Our technologies turn data into information with context to form the knowledge base for enterprise AI.
Cautionary Statement Regarding Forward-Looking Statements
Certain statements in this press release may contain words considered forward-looking statements or information under applicable securities laws. These statements are based on OpenText's current expectations, estimates, forecasts and projections about the proposed conditional redemption, the potential senior secured notes offering, and the operating environment, economies and markets in which OpenText operates. These statements are subject to important assumptions, risks and uncertainties that are difficult to predict, and the actual outcome may be materially different. OpenText's assumptions, although considered reasonable by OpenText at the date of this press release, may prove to be inaccurate and consequently its actual results could differ materially from the expectations set out herein. For additional information with respect to risks and other factors which could occur, see OpenText's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other securities filings with the Securities and Exchange Commission and other securities regulators. Readers are cautioned not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. Unless otherwise required by applicable securities laws, OpenText disclaims any intention or obligations to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Copyright © 2026 OpenText. All Rights Reserved. Trademarks owned by OpenText. One or more patents may cover this product(s).
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SOURCE Open Text Corporation
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What is the financing condition for redeeming OpenText's 2027 notes?
The redemption of the 6.900% Senior Secured Notes due 2027 is conditioned on OpenText receiving net proceeds from one or more offerings of debt securities that are sufficient to pay the redemption price and all other amounts payable in connection with the redemption. The company may also use cash on hand to fund a portion of these amounts if the financing condition is otherwise met or waived.
How will OpenText use the proceeds of the potential senior secured notes offering?
OpenText expects to use the net proceeds from any Rule 144A/Regulation S senior secured notes offering to fund the redemption of the 2027 notes, including the applicable redemption premium, accrued and unpaid interest, and related costs and expenses. Any remaining net proceeds are expected to be used for general corporate purposes, which may include repurchase or repayment of other outstanding debt.
Does this press release itself constitute a notice of redemption or an offer of securities?
No. The press release does not constitute a notice of redemption under the indenture for the 2027 notes and does not constitute an offer to sell or the solicitation of an offer to buy the potential senior secured notes. The actual notice of redemption has been made only in accordance with the indenture, and any notes offering would be conducted under exemptions from registration, including Rule 144A and Regulation S.