AST SpaceMobile, Inc. (ASTS) shares tumbled 6.80% in pre-market trading on Wednesday following the company's announcement of a strategic financial move to repurchase $225 million of its convertible notes due 2032 through a new share offering.

The satellite communications firm revealed plans to sell 9,450,268 shares of its Class A common stock at $53.22 per share in a registered direct offering to certain holders of its convertible bonds. The proceeds from this offering will be used to fund the repurchase of $225 million of convertible bonds due 2032. This transaction effectively retires about half of the company's 2032 convertible bonds, removing approximately 8.3 million underlying shares and nearly $63.8 million of remaining interest.

While the move is aimed at reducing AST SpaceMobile's debt load and future interest obligations, investors appear concerned about the dilutive effect of issuing new shares. The company noted that the transaction will result in about 1.04 million incremental shares being issued. Despite the negative pre-market reaction, it's worth noting that AST SpaceMobile's stock has performed well year-to-date, up 152.2% as of the previous close. The transaction is expected to close around July 1, 2025, and will leave $235 million of the convertible notes still outstanding.