Zscaler Announces Pricing of $1.5 Billion Offering of 0.00% Convertible Senior Notes Due 2028

Key Takeaways:

• Zscaler is issuing $1.5 billion in zero-interest convertible senior notes due 2028.
• The notes will be sold in a private offering to qualified institutional buyers under Rule 144A.
• Initial purchasers have a 13-day option to buy an additional $225 million in notes.
• The offering is expected to close on July 3, 2025, subject to customary closing conditions.

Zscaler Announces Major Convertible Notes Offering

Zscaler, Inc. (Nasdaq: ZS) announced the pricing of $1.5 billion aggregate principal amount of 0.00% convertible senior notes due 2028. This significant financial move reflects the company’s strategic approach to capital management.

Details of the Zero-Interest Notes

The convertible senior notes bear an interest rate of 0.00% and are set to mature in 2028. The substantial offering underscores Zscaler’s position in the market and its outlook for future operations.

Private Offering to Qualified Institutional Buyers

The notes will be sold in a private offering to persons reasonably believed to be qualified institutional buyers, pursuant to Rule 144A under the Securities Act of 1933, as amended. This private placement method allows the company to tap into a specific segment of sophisticated investors while complying with regulatory standards.

Option for Additional Purchase

In addition to the initial offering, Zscaler has granted the initial purchasers a 13-day option to purchase up to an additional $225 million aggregate principal amount of notes. This option provides flexibility to accommodate potential additional demand from investors, potentially increasing the total proceeds from the offering.

Expected Closing Date

The offering is expected to close on July 3, 2025, subject to customary closing conditions. The anticipated closing signifies the culmination of the transaction within a defined timeframe, pending the fulfillment of standard regulatory and contractual requirements.