The Motley Fool fool.com 15 Sep, 2021 01:15 am

Why Jamf Holding Stock Slumped on Tuesday

Why Jamf Holding Stock Slumped on Tuesday
Investors are worried about the potential for dilution.

These transaction are designed to "reduce potential dilution to the common stock upon any conversion of notes," while simultaneously offsetting cash payments in excess of the principle of the notes." Since these notes are primarily being used to replace existing debt and Jamf is managing the potential for dilution, this is largely a non-event.Jamf will retain the right to convert these obligations to cash, common stock, or a combination of the two, at the company's election.Jamf announced plans to raise capital by selling convertible notes, which spooked some investors.

Now what Jamf plans to use some of the proceeds of the capital raise to repay the term loan used to acquire Wandera, which expanded its capabilities in zero trust cloud security and access.The remainder of the funds will be used to pay for the capped calls and for "general corporate purposes.

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