Oracle Plans Multi-Billion Dollar Mandatory Convertible Preferred Stock and ATM Equity Offerings

summarizeSummary

Oracle filed a preliminary prospectus supplement for an offering of 100 million depositary shares representing Series D Mandatory Convertible Preferred Stock, alongside a concurrent senior notes offering and an At-The-Market (ATM) program for up to $20 billion in common stock, signaling a substantial capital raise.

check_boxKey Events · Financing and Capital Events · ORCL

• Mandatory Convertible Preferred Stock Offering

  Oracle is offering 100 million depositary shares, each representing a 1/2,000th interest in a share of Series D Mandatory Convertible Preferred Stock, with a liquidation preference of $50 per depositary share, totaling $5 billion.

• Concurrent Senior Notes Offering

  The preferred stock offering is concurrent with a public offering of senior notes, the aggregate principal amount of which is not yet specified.

• $20 Billion At-The-Market (ATM) Program

  Oracle is also establishing an ATM program to sell up to $20 billion of common stock from time to time, further expanding its capital-raising capacity.

• Dilutive Equity Structure

  The mandatory convertible preferred stock will automatically convert into common stock on January 15, 2029, or earlier at the holder's option, leading to future dilution for common shareholders.

auto_awesomeAnalysis · ORCL · Technology

This 424B5 filing details a significant capital raising initiative by Oracle, outlining the structure for 100 million depositary shares of mandatory convertible preferred stock, which represents a $5 billion liquidation preference. This offering is part of a broader financing strategy that also includes a concurrent senior notes offering and an At-The-Market (ATM) program allowing for the sale of up to $20 billion in common stock. The combined potential equity raise (preferred stock converting to common, plus the ATM program) represents a substantial increase in potential shares outstanding, creating a significant dilutive overhang for existing shareholders. While the specific pricing and dividend rate for the preferred stock are not yet finalized, the intent to raise such a large amount of capital provides Oracle with considerable financial flexibility for general corporate purposes, including potential acquisitions, debt repayment, and capital expenditures. This follows a Free Writing Prospectus filed earlier today, which broadly outlined plans to raise $45-$50 billion in 2026, and this filing provides specific details for a key equity component of that plan.