Encore Capital Group Announces Redemption of All Outstanding 4.00% Convertible Senior Notes Due 2029
Rhea-AI Summary
Encore Capital Group (Nasdaq: ECPG) has called for the redemption of all $230.0 million aggregate principal amount of its 4.00% Convertible Senior Notes due 2029. The company issued a redemption notice on July 22, 2026, setting September 24, 2026 as the redemption date.
The redemption price will be paid in cash at 100% of principal plus accrued and unpaid interest, or about $1,001 per $1,000 principal. Holders may convert their Notes up to 5:00 p.m. (New York City time) on September 22, 2026, after which unconverted Notes will be redeemed and canceled. During the make-whole conversion period, the conversion rate increases from 15.1763 to 16.2056 shares per $1,000 principal. Encore also expects to unwind and terminate related capped call transactions around the redemption date, with potential secondary-market sales by option counterparties that may affect the trading price of its common stock.
Positive
- $230.0 million of 4.00% convertible notes called for September 24, 2026 redemption
- Redemption price set at about $1,001 per $1,000 principal, paid fully in cash
- Make-whole conversion period boosts conversion rate to 16.2056 shares per $1,000 principal
- Encore expects to receive value from unwinding capped call transactions around the redemption date
Negative
- Redemption requires cash outlay on $230.0 million principal plus accrued interest
- Unwind of capped call transactions may decrease or limit increases in ECPG share price
- Any notes not converted will continue as cash liabilities until redeemed on September 24, 2026
News Explained
The release specifies that Notes submitted for conversion after the redemption call will be settled in cash, while Notes not converted by the deadline will also be redeemed for cash and canceled.
News Market Reaction – ECPG
In the Jul 23 session, ECPG declined 2.92%, reflecting a moderate negative market reaction. Argus tracked a trough of -2.1% from its starting point during tracking. Our momentum scanner triggered 6 alerts that day, indicating moderate trading interest and price volatility. Trading volume was very high at 3.2x the daily average, suggesting heavy selling pressure.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Historical Context
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| Jul 06 | Earnings date notice | Neutral | +0.7% | Company scheduled release of second-quarter 2026 financial results for August 5. |
| May 13 | Notes offering pricing | Positive | +3.4% | Upsized €325 million notes offering supported planned debt refinancing and unchanged guidance. |
| May 12 | Notes offering proposal | Neutral | -0.9% | Company proposed €300 million secured notes offering to refinance existing debt. |
| May 11 | Notes offering pricing | Positive | -0.9% | Company priced $750 million secured notes to redeem higher-cost outstanding debt. |
| May 11 | Notes offering proposal | Neutral | -1.9% | Company proposed $550 million secured notes offering for debt redemption and expenses. |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Historical financing-related announcements showed mixed 24-hour reactions, ranging from +3.43% to -1.85%.
Key Terms
convertible senior notes financial
make-whole fundamental change financial
capped call transactions financial
conversion rate financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
SAN DIEGO, July 22, 2026 (GLOBE NEWSWIRE) -- Encore Capital Group, Inc. (Nasdaq: ECPG) (“Encore” or the “Company”), an international specialty finance company, announced today that on July 22, 2026 (the “Redemption Notice Date”), it has issued a notice (the “Redemption Notice”) to holders of the Company’s
Redemption Process
The redemption price will be payable on the Redemption Date in cash and equal to
For all Notes surrendered in book-entry form, payment of the Redemption Price will be made through the facilities of The Depository Trust Company (“DTC”), and all redeemed Notes in book-entry form will be surrendered for payment of the Redemption Price in accordance with the applicable rules and procedures of DTC.
Right to Convert the Notes
Holders of the Notes may surrender their Notes (or any portion thereof having a principal amount that is an integral multiple of
As of the Redemption Notice Date, the conversion rate of the Notes is 15.1763 shares of common stock per
The sending of the Redemption Notice to the holders of the Notes constitutes a “Make-Whole Fundamental Change” under the Indenture, and therefore the conversion rate is required to be increased in accordance with Section 13.03 of the Indenture for Notes surrendered for conversion during the period beginning on, and including, the Redemption Notice Date, and ending at 5:00 p.m. (New York City time) on September 22, 2026 (the “Make-Whole Conversion Period”). The conversion rate applicable to such conversions will be increased by 1.0293 additional shares to 16.2056 shares of common stock per
Truist Bank is acting as Trustee, paying agent and conversion agent under the Indenture, and its address is 2713 Forest Hills Road, Building 2 - Floor 2, Wilson, North Carolina 27893, Attention: Encore Capital Group – Client Manager – Patrick Giordano.
Holders who have questions or who wish to discuss the redemption may contact the Company’s Investor Relations representative by email at Bruce.Thomas@encorecapital.com.
This press release does not constitute a notice of redemption under the Indenture. The Redemption Notice is being delivered to holders separately in accordance with the terms of the Indenture. This press release is neither an offer to sell nor a solicitation of an offer to buy the Notes or any other securities and shall not constitute an offer to sell or a solicitation of an offer to buy, or a sale of, the Notes or any other securities in any jurisdiction in which such offer, solicitation or sale is unlawful. No representation is made as to the correctness or accuracy of the CUSIP number either as printed on the notes or as contained in this press release.
Capped Call Transactions
In connection with the pricing of the Notes in February 2023, the Company entered into privately negotiated capped call transactions with certain financial institutions (the “option counterparties”). In connection with the redemption, the Company expects that the capped call transactions will unwind and terminate in full. In connection with any such unwind and termination, the Company would receive from each option counterparty an amount of cash (or shares of the Company’s common stock if agreed with the applicable option counterparty) reflecting the then-current option value of such capped call transaction, as determined pursuant to the terms of such transaction or as otherwise agreed with the Company. The Company expects to enter into bilateral unwind agreements with each option counterparty to unwind and terminate its respective capped call transaction as of or shortly following the Redemption Date, with a termination value determined based on the market price of the Company’s common stock over a valuation period expected to end shortly prior to the Redemption Date and payable to the Company on or shortly following the Redemption Date, in each case, subject to extension.
In connection with unwinding and terminating the capped call transactions, the option counterparties and/or their respective affiliates are expected to unwind various derivative transactions with respect to the Company’s common stock and/or sell shares of the Company’s common stock or other securities of the Company in secondary market transactions. This activity may have the effect of decreasing (or reducing the size of any increase in) the market price of the Company’s common stock.
About Encore Capital Group, Inc.
Encore Capital Group is an international specialty finance company that provides debt recovery solutions and other related services for consumers across a broad range of financial assets. Through its subsidiaries around the globe, Encore purchases portfolios of consumer receivables from major banks, credit unions, and utility providers.
Encore partners with individuals as they repay their debt obligations, helping them on the road to financial recovery and ultimately improving their economic well-being. Encore is the first and only company of its kind to operate with a Consumer Bill of Rights that provides industry-leading commitments to consumers. Headquartered in San Diego, Encore is a publicly traded NASDAQ Global Select company (ticker symbol: ECPG) and a component stock of the Russell 2000, the S&P Small Cap 600 and the Wilshire 4500. More information about the company can be found at www.encorecapital.com.
Cautionary Note Regarding Forward-Looking Statements
The statements in this press release that are not historical facts, including, most importantly, those statements preceded by, or that include, the words “will,” “may,” “believe,” “projects,” “expects,” “anticipates” or the negation thereof, or similar expressions, constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Reform Act”). These statements may include, but are not limited to, statements regarding our future operating results, performance, liquidity, ability to access capital markets, business plans or prospects. For all “forward-looking statements,” the Company claims the protection of the safe harbor for forward-looking statements contained in the Reform Act. Such forward-looking statements involve risks, uncertainties and other factors which may cause actual results, performance or achievements of the Company and its subsidiaries to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These risks, uncertainties and other factors are discussed in the reports filed by the Company with the Securities and Exchange Commission, including the most recent reports on Forms 10-K and 10-Q, each as it may be amended from time to time. The Company disclaims any intent or obligation to update these forward-looking statements.
Contacts
Bruce Thomas
Encore Capital Group, Inc.
bruce.thomas@encorecapital.com
