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JWCA advises Microchip Technology on its $900 million ZERo-coupon convertible senior notes offering + capped call transaction

February 2026 | read press release

Transaction Background

Microchip Technology Incorporated (“Microchip” or the “Company”) successfully raised $900mm (inclusive of greenshoe) in the convertible market at attractive terms (0.00% coupon and 40.0% conversion premium)

Microchip’s objectives included:

  • Refinance more expensive outstanding debt to lower cash interest expense and drive EPS accretion

  • Offer a one-time discrete put option to receive a lower coupon on financing (0.00%)

  • Protect against future equity dilution through a derivative overlay

JWCA provided extensive analysis on deal structuring and related items, including:

  • Convertible and derivative overlay structuring

  • Syndicate structure and precedent data

  • Convertible and capped call documentation to ensure maximum value and future efficiency/flexibility for the company

JWCA designed and ran a capped call auction process to achieve competitive terms

JWCA provided advice, support and analysis throughout the execution process

Results

Microchip’s convertible transaction was very well received by investors:

  • The transaction was multiple times oversubscribed, leading to the issue being upsized by $200mm (~33% of original $600mm base deal)

  • The transaction priced with a 0.00% fixed coupon and 40.0% conversion premium, pricing through the high end of the marketed range of 32.5 - 37.5%

JWCA supported the management team on the entirety of the offering providing execution advice and ensuring a high-quality execution:

  • JWCA designed a custom put structure that helped save the Company ~$6mm a year in coupon expense

  • Capped call documentation and auction process produced meaningful savings for Microchip, while maximizing flexibility for the Company

  • J. Wood Capital supported the transaction by purchasing $25mm of MCHP stock

This is JWCA’s sixth advisory assignment for the Company after advising Microchip on capital structure transactions in February 2015, February 2017, June 2017, May 2024, and March 2025