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(Bloomberg) -- Snap Inc. plans to offer $700 million of junk bonds to repurchase convertible debt, the social-media company said in a statement on Monday.

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Snap intends to sell the new senior notes, which mature in 2033, in a private offering. Proceeds will be used to repurchase convertible notes that are due as soon as this year through 2028, with any remaining funds going toward general corporate purposes or repurchases of other securities.

The move comes as Snap’s stock is trading at roughly half the conversion price for existing notes that are coming due soon. Its shares closed at $10.92 on Friday, compared with a conversion price of $21 to $23 for notes due this year and next, according to data compiled by Bloomberg.

Representatives for Snap and bookrunners JPMorgan Chase & Co. and Goldman Sachs Group Inc. declined to comment.

It is Snap’s first straightforward bond offering at a time when there has been a flurry of issuance, even for junk-rated companies like itself. Snap, which operates the photo and video messaging service Snapchat, carries a B1 rating from Moody’s Ratings and a BB rating from Fitch Ratings, according to statements from those firms on Monday.

The bonds are being offered at a yield in the low-7% range, according to a person with knowledge of the matter. They may be sold as soon as Tuesday, said the person, who was not authorized to speak publicly.

Moody’s cited “the intense competitive environment the company operates in,” noting that it is smaller than competitors like Facebook parent Meta Platforms Inc. and that it also faces risks from regulations, dips in advertising revenue and new, disruptive technologies.

Snap’s is at least the second debut junk-bond sale this month after Long Ridge Energy priced its first-ever offering last week.

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