Menlo Park, California, USA, October 26th / PRNewswire / -- Meta Platforms, Inc. (Nasdaq ticker: META, hereinafter referred to as “Meta” or “the Company”) announced today that the pricing has been completed for two separate, simultaneous public offerings it previously disclosed: (i) 250 million Class A depositary receipts (“depositary receipts”), each representing 1/20 of the rights to 6.50% of newly issued Class A convertible preferred stock with a par value of $0.000006 per share, with a public offering price of $50 per depositary receipt (“depositary receipt offering”); and (ii) $25 billion in Class A common stock related to the forward sale agreement described below, with each common share having a par value of $0.000006 and a public offering price of $625.00 per share (“common stock offering”). The two offerings are collectively referred to as the “offering.” The scale of the common stock offering has been increased from the previously announced $22.5 billion to $25 billion.
Meta has granted the underwriters of the depositary receipts a 30-day over-allotment option to purchase an additional maximum of 37.5 million depositary receipts at the public offering price, less the applicable underwriting discount, solely to cover any over-allotment (if any). After deducting the applicable underwriting discount and the estimated issuance costs that Meta is required to pay, the net proceeds from the issuance of the depositary receipts are approximately $12.5 billion; if the underwriters exercise the over-allotment option in full, the net proceeds would be approximately $14.3 billion. Meta intends to use this portion of the net proceeds for general corporate purposes.
Depository receipt holders will enjoy the rights and priority order of preferred stock in proportion, including conversion rights, dividend rights, liquidation rights, and voting rights, subject to the terms of the depository agreement. The preferred stock will accrue dividends at an annual rate of 6.50%. Dividends may be initially paid in cash, or under certain restrictions, in Class A common stock, or in any combination of cash and Class A common stock; these dividends are calculated based on a liquidation preference of $1,000 per share and will be announced for payment by the Meta Board of Directors (or its authorized committee) on February 15th, May 15th, August 15th, and November 15th. This period will commence from February 15, 2027, and end on August 15, 2029 (including that day).
Unless converted in advance, each outstanding preferred share will automatically convert into 1.3620 to 1.6000 Class A common shares around August 15, 2029 (correspondingly, each depositary receipt will automatically convert into 0.0681 to 0.0800 Class A common shares), and will be subject to regular anti-dilution adjustments. The specific conversion ratio will be determined based on the weighted average price of Class A common shares traded during the final averaging period. The final averaging period will be the 20 consecutive trading days (including the first day) starting from the 21st planned trading day prior to August 15, 2029.
In addition, if Meta issues a revision to its Class A articles of association and redefines the Class C common shares established by the certificate, and meets certain other conditions, then: (1) Each preferred share (and accordingly, each depositary receipt) may be converted into Class C common shares on or around August 15, 2029, at the weighted average price of the trading volume of Class C common shares during the final average period, at a conversion rate that is not less than the lowest conversion rate at that time and not higher than the highest conversion rate at that time; (2) Except during the significant change conversion period (defined in the supplementary documents to the prospectus related to the issuance of the depositary receipts), at any time after the 50th trading day following the dividend trigger date for Class C common shares and before the mandatory conversion settlement date, the holder of 20 depositary receipts may cause the bank depositary institution to convert one preferred share into several Class C common shares calculated at the lowest conversion rate at that time; (3) The cumulative dividends of the preferred shares may be paid by Meta in cash, or under certain restrictions, in Class C common shares, or in any combination of cash and Class C common shares. Currently, there is no public market for either the depositary receipts or the preferred shares.
Meta has applied to list the depositary receipts on NASDAQ Global Select Market, with the trading code being “METAM”. The issuance of the depositary receipts is expected to be completed on October 29, 2026, but delivery conditions must be met.
Synchronized with the issuance of depositary receipts, Meta has signed forward stock sale agreements with Morgan Stanley Capital Services Limited and Goldman Sachs Company Limited ("forward buyers"), initially involving a total of 40 million Class A ordinary shares. After the issuance of Class C ordinary shares and the fulfillment of certain other conditions, Meta expects that these forward stock sale agreements will also refer to both Class A and Class C ordinary shares. As part of these forward stock sale agreements, the forward buyers or their respective affiliates are expected to borrow shares from third parties and have agreed to sell a total of 40 million Class A ordinary shares to the underwriters of the ordinary share issuance. The issuance of ordinary shares is expected to be completed on October 29, 2026, subject to meeting the delivery conditions.
Meta has also granted the underwriters of the common stock issuance a 30-day option to purchase an additional maximum of $3.75 billion worth of Class A common stock. If this option is exercised, Meta expects to sign additional forward sale agreements with each forward buyer for such shares. Meta does not expect to obtain any immediate income from selling Class A common stock to the forward buyers (or their affiliates) in this common stock issuance. Based on the initial forward price of approximately $622.92 per share (which is roughly the price at which the underwriters agreed to purchase the Class A common stock), Meta expects to raise approximately $24.9 billion in net proceeds from the common stock issuance upon settlement of the forward sale agreements; if the underwriters exercise the option to purchase the additional Class A common stock in full, it would be approximately $28.7 billion. This amount is subject to price adjustments and other terms in the forward sale agreements, and settlement is expected to be completed on or before November 19, 2027. Meta intends to use the net proceeds received from the future settlement of the forward sale agreements and any additional forward sale agreements for general corporate purposes.
In accordance with the terms of the forward sale agreement and any additional forward sale agreements, Meta intends to issue and deliver a total of 40 million Class A ordinary shares (or 46 million Class A ordinary shares if the underwriters fully exercise their over-allotment option and Meta enters into an additional forward sale agreement for such shares) to the forward buyer on or before November 19, 2027, in exchange for cash proceeds equal to the applicable forward sale price of approximately $622.92 per share, subject to adjustments as stipulated in the forward sale agreement and any additional forward sale agreements. However, after the issuance of Class C ordinary shares and the fulfillment of certain other conditions, these forward sale agreements will also refer to both Class A and Class C ordinary shares. In some cases, Meta may settle all forward sale agreements by delivering only Class C ordinary shares.
The completion of the issuance of depositary receipts is not conditional upon the completion of the issuance of common shares, nor is the completion of the issuance of common shares conditional upon the completion of the issuance of depositary receipts.
Morgan Stanley and Goldman Sachs Company Limited act as the joint lead underwriters for this issuance. Allen & Company LLC, BDT & MSD, Centerview Partners, Jefferies, Lazard and The Raine Group act as joint underwriters.
The registration statements related to these securities (including the prospectus), designated as S-3, have been submitted to the U.S. Securities and Exchange Commission (SEC) and are now in effect. Each issuance can only be conducted through the supplementary documents to the prospectus and the prospectus itself. The relevant final supplementary documents to the prospectus and the prospectus itself can be obtained at the website SEC at http://www.sec.gov, or by contacting Morgan Stanley & Co. Contact information is as follows: Prospectus Department, 180 Varick Street, 2nd Floor, New York, NY 10014; email: [email protected]; or Goldman Sachs & Co. LLC. Contact information is: Prospectus Department, 200 West Street, New York, NY 10282; phone: 1-866-471-2526; email: [email protected].
This press release does not constitute an offer to sell these securities or an invitation to purchase these securities, nor does it constitute an offer, invitation, or sale of these securities in any jurisdiction where such an offer, invitation, or sale would be illegal.
Tips on Forward-Looking Statements
This press release contains forward-looking statements. Except for statements of historical fact, all statements contained herein, including those regarding the issuance, establishment and issuance of Class C ordinary shares, the amendment and reissuance of certificates, our ability to complete the issuance on schedule or at all, as well as the intended uses of the net proceeds raised, and statements regarding our future operating results and financial condition, business strategy and plans, and future business objectives, are forward-looking statements. Words such as "believe," "may," "will," "expect," "continue," "anticipate," "intend," and "expect" are used to identify these forward-looking statements. We make these forward-looking statements based primarily on our current expectations and forecasts of future events and trends, which we believe may affect our financial condition, operating results, business strategy, short-term and long-term business operations and objectives, as well as capital needs. These forward-looking statements are subject to a number of risks, uncertainties, and assumptions, including those described in our most recent 10-Q quarterly report and other documents submitted to SEC. In addition, we operate in a highly competitive and rapidly changing environment, and new risks may arise from time to time. Management cannot predict all risks, nor can it assess the impact of all factors on our business, or the extent to which one factor or a combination of factors could cause actual results to differ significantly from those anticipated in the forward-looking statements. Given these risks, uncertainties, and assumptions, the future events and trends discussed in this press release may not occur, and actual results may differ significantly and unfavorably from those anticipated or implied in the forward-looking statements.
Except as required by law, we do not assume any obligation to revise or publicly release any results of forward-looking statements. In light of these risks and uncertainties, readers are advised not to rely excessively on such forward-looking statements.
Unless otherwise clearly stated or required by context, the terms “Meta”, “company”, “we”, “our side”, and “our” in this document refer to Delaware corporation Meta Platforms, Inc, and in appropriate cases, also include its subsidiaries.
About Meta
Meta is creating a future of human connection driven by artificial intelligence and immersive technology. Facebook changed the way people connected when it was launched in 2004. Applications such as Messenger, Instagram, and WhatsApp have further empowered billions of users around the world. Today, Meta is moving forward towards creating a deeper level of connection and unlocking even more possibilities.
Contact Information
Investor: Rob Bevegni [ email protected ] / investor.atmeta.com
Media: Matt Tye [ email protected ] / meta.com / news
