Realogy Holdings Corp. (RLGY) stock prices were down by a concerning 9.98% as of the market closing on May 27th, 2021, bringing the price per share down to USD$17.49 at the end of the trading day.
Upsizing of Private Offering
May 27th, 2021 saw the company announce the pricing for its previously announced private offering. Having been exempt from the registration requirements of the Securities Act of 1933, the company upsized its offering from USD$300 million to USD$350 million. The offering will see the aggregate principal amount being issued in the form of exchangeable senior notes with a due date of 2026. Pending customary closing conditions, the sale and issuance of the notes are scheduled to settle on June 2nd, 2021. RLGY also granted initial purchasers a 13-day option to acquire up to an additional USD$52.5 million aggregate principal worth of notes.
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Guarantee of Notes
The notes will be guaranteed by each of the company’s domestic subsidiaries that is a guarantor under its senior secured credit facilities. The notes will be guaranteed on a senior unsecured basis, as well as on a subordinated unsecured senior basis. The notes will be effectively subordinated to all of RLGY’s existing and to-be-incurred senior secured debt, including the company’s senior secured credit facilities. The extent of this condition is capped at the value of the assets securing such debt, and pari passu to all of RLGY’s existing and future senior debt, including its existing senior notes.
Exchangeable Notes
The interest accrued on the notes is set at 0.25% per annum, payable semi-annually in arrears on June 15th and December 15thof each year, starting from December 15th of 2021. The maturation date for the notes is set for June 15th, 2026, unless the notes are repurchased, redeemed, or exchanged. Until March 15th, 2026, holders of the notes will have the right to exchange their notes under certain predetermined circumstances. Beyond that date, holders of notes have the option to exchange their notes at any time of their choosing until the end of the second trading day immediately before the maturity date of the notes
Development of RealSure
The company also recently announced the accelerated expansion of its real estate cash offer program RealSure. Having launched in six additional markets across the U.S. on May 25th, 2021, the program is now available to home sellers in 21 major U.S. markets. More than 30,000 read estate agents across various big-name brands have access to the Real Sure tool to facilitate the selling and buying of qualified property belonging to clients.
Future Outlook for RLGY
Armed with a solid liquidity position owing to the expanded private offering of exchangeable notes, RLGY is poised to capitalize on its comfortable situation to facilitate further growth. Current and potential investors are hopeful that the company will manage to leverage the resources at its disposal to usher in significant and sustained increases in shareholder value.
