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Comtech’s offices in Chandler, Arizona.Photo: Comtech
Comtech Telecommunications The company announced Monday that it has received a $45 million investment from current shareholder WhiteHat Capital Partners and funds affiliated with investment management firm Magnetar. Comtech said the investment will further increase its financial flexibility. Comtech plans to use the investment to support various initiatives and growth prospects, including working capital needs such as debt repayments.
Under the terms of the transaction, WhiteHat and Magnetar purchased $45 million of a new series of convertible preferred stock and exchanged all outstanding shares of Comtech’s existing convertible preferred stock for shares of the new series of convertible preferred stock. The preferred stock will be convertible into Comtech common stock at a conversion price of $7.99 per share. Upon Comtech’s election, the shares will include a 9.00% dividend payable in kind or a 7.75% dividend payable in cash.Option redemption date includes October 31, 2028
Comtech is engaged in the process of refinancing its existing credit facilities, which it said in its latest quarterly results. Comtech said this investment is a step toward that goal and demonstrates White Hat and Magnetar’s commitment to Comtech.White Hat and Magnetar used to be Investing $100 million in Comtech in 2021.
“We are grateful for this investment and for the support of our two existing long-term shareholders in our strategy and team,” said Ken Peterman, Chairman and CEO of Comtech. “Magnetar and White Hat understand the potential of our company, our end markets, and our One Comtech vision. With their extensive investment experience across asset classes and capital structures, we value their continued support.”
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