Netflix Inc said on Monday it planned to raise $1.5 billion (about Sh150 billion) in debt, the second time the company is tapping the debt market in less than a year to fuel a rapid expansion in original content.
The video streaming pioneer, which raised $1.6 billion in debt last October, has been spending aggressively on original content to drive subscriber growth around the world.
Netflix crushed Wall Street’s estimates for subscriber additions earlier this month, driven by hit original shows “Altered Carbon” and “Jessica Jones”, and said it looks to spend nearly $8 billion (about Sh800 billion) on content in 2018.
The company also reported long-term debt of $6.5 billion (about Sh650 billion) at the end of first quarter and said it expects free cash flow to be negative in the second half of 2018.
Netflix had around $2.6 billion (about Sh260 billion) in cash, according to the company’s latest quarterly report.
The company said on Monday it intends to use the net proceeds from the offering for general corporate purposes, which may include content acquisitions, production.
Netflix shares were up 1 per cent in premarket trading.
Key CBK Indicative Exchange Rates Used: $1 = Sh100.06