PureCycle Technologies Announces Closing of \$287.5 Million Convertible Senior Notes and Common Stock Offerings
Key Highlights from the Report
- PureCycle Technologies, Inc. (NASDAQ: PCT) has successfully closed concurrent public offerings totaling \$287.5 million in aggregate principal amount of 4.75% convertible senior notes due 2032 and 19,854,000 shares of common stock.
- The offerings included full exercise of underwriter options: an additional \$37.5 million in notes and 2,283,800 shares of common stock.
- Morgan Stanley acted as the sole bookrunner for both offerings.
- The offerings were conducted under an automatically effective shelf registration statement filed with the SEC on June 10, 2026.
Details of the Convertible Senior Notes
- The 4.75% convertible senior notes are general unsecured obligations of PureCycle and will accrue interest from June 15, 2026, payable semi-annually in arrears on January 1 and July 1 each year (first payment due January 1, 2027).
- The notes mature on July 1, 2032, unless converted, redeemed, or repurchased earlier.
- Holders can convert the notes at any time before the second scheduled trading day prior to maturity, with PureCycle settling conversions in cash, shares, or a combination at its discretion.
- The initial conversion rate is 90.2242 shares per \$1,000 principal, implying a conversion price of ~\$11.08 per share—a 35% premium over the stock offering price.
- The conversion rate and price are subject to adjustment for certain events but not for accrued interest. Following certain corporate events or redemption notices, holders who convert may receive an increased conversion rate.
- Redemption terms: PureCycle cannot redeem the notes before July 6, 2029. After that, the company can redeem for cash if the share price is at least 130% of the conversion price for a specified period.
- On July 8, 2030 or after a “fundamental change,” holders can require PureCycle to repurchase notes for cash at 100% of principal plus accrued interest.
Use of Proceeds and Financial Impact
- Aggregate net proceeds from the offerings are approximately \$432.5 million after deducting underwriting discounts and offering expenses.
- PureCycle expects to use ~\$246.3 million of the proceeds to repurchase ~\$216.0 million principal amount of its 7.25% Green Convertible Senior Notes due 2030 in privately negotiated transactions, with settlement anticipated on or about June 15, 2026.
- The remaining proceeds will be used for repurchasing additional Green Convertible Notes and for general corporate purposes, including working capital.
Shareholder Considerations and Price-Sensitive Information
- This capital raising and debt restructuring is significant, as it improves PureCycle’s liquidity position and potentially reduces interest costs by refinancing higher-rate Green Convertible Notes.
- The conversion price of the new notes represents a substantial premium over the stock offering price, suggesting confidence in future share price growth from management and underwriters.
- Potential dilution: If the notes are converted, the issuance of additional shares could dilute existing shareholders.
- Redemption and repurchase features provide flexibility but may affect share price during periods when the stock trades well above the conversion price or if a fundamental change occurs.
- The use of proceeds toward debt repurchase and general corporate purposes signals a strategic focus on balance sheet optimization and growth initiatives.
About PureCycle Technologies
PureCycle Technologies LLC, a subsidiary of PureCycle Technologies, Inc., holds a global license for a patented dissolution recycling technology developed by Procter & Gamble. This process transforms polypropylene (#5 plastic) waste into a renewable resource by removing color, odor, and impurities, creating PureFive® resin, which can be recycled and reused multiple times.
Forward-Looking Statements
This article contains forward-looking statements based on management’s current expectations, including statements regarding the use of proceeds and the impact of the offerings. Actual results may differ materially due to risks, uncertainties, and changes in circumstances. Investors should review the risk factors disclosed in PureCycle’s prospectus supplements and related filings.
Disclaimer: The information contained herein is not investment advice and is based on public filings and press releases from PureCycle Technologies, Inc. Investors should conduct their own due diligence and consult with financial advisors before making investment decisions. The article may contain forward-looking statements subject to risks and uncertainties.
