Jefferies Financial Group Inc. Announces Pricing of $1,500,000,000 6.200% Senior Notes Due 2034
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The announcement by Jefferies Financial Group Inc. regarding the pricing of their public offering of $1.5 billion in Senior Notes at a 6.200% interest rate is a substantial move in the company's capital structure strategy. The effective yield slightly higher than the interest rate indicates a slight premium over the par value, which can be seen as a positive sign of investor confidence in the company's creditworthiness. The long-term nature of these notes, maturing in 2034, provides investors with a predictable income stream, which could be particularly attractive in a low-interest-rate environment.
From a financial planning perspective, this capital raise through debt rather than equity helps avoid shareholder dilution. The use of proceeds for general corporate purposes is broad, but typically this could mean refinancing existing debt, funding acquisitions, or investing in growth opportunities. Investors and analysts will closely monitor the deployment of these funds to assess whether they contribute to the company's long-term value creation.
Jefferies' choice of using a shelf registration for this offering allows for a more efficient transaction process. A shelf registration is a procedure that allows an issuer to fulfill regulatory requirements beforehand and go to market quickly when conditions are favorable. The involvement of multiple financial institutions as book-runners and co-managers indicates a broad interest in the offering and a potentially wide distribution of the notes.
The selection of a single global coordinator and joint book-runner, along with a diverse group of senior co-managers and co-managers, reflects a strategic approach to balance the need for a lead on the deal while also ensuring distribution capabilities and investor reach. The pricing of the notes in the current market environment will be a benchmark for future offerings, not just for Jefferies but also for similar firms in the financial sector.
The issuance of Senior Notes by Jefferies Financial Group can be seen as a response to the current capital market conditions. With interest rates potentially on the rise, locking in a fixed interest rate for the next decade can be a strategic move to manage future interest expenses. It reflects a forward-looking approach to capital management, especially considering the potential for increased borrowing costs as monetary policy tightens.
Investors will evaluate this offering within the context of the broader financial sector and current economic trends. The demand for this debt issuance will be indicative of the market's risk appetite and the perceived stability of the financial services industry. The success of this offering could influence other companies' decisions to enter the debt market, setting a tone for corporate finance activities in the near term.
JFG intends to use the net proceeds of the offering for general corporate purposes. Jefferies LLC served as sole global co-ordinator and joint book-runner for the offering of the Notes, SMBC Nikko Securities America, Inc. served as joint book-runner, BNY Mellon Capital Markets, LLC, Citigroup Global Markets Inc. and HSBC Securities (
The offering of the Notes is being made pursuant to an effective shelf registration statement, base prospectus and related prospectus supplement. Copies of the prospectus supplement and the base prospectus, when available, may be obtained by contacting Jefferies LLC at toll-free (877) 877-0696, or by email at DCMProspectuses@jefferies.com; or SMBC Nikko Securities America, Inc. at toll-free (888) 868-6856, or by email at prospectus@smbcnikko-si.com. Investors may also obtain these documents for free by visiting EDGAR on the Securities and Exchange Commission's (“SEC”) website at www.sec.gov.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction.
About Jefferies Financial Group Inc.
JFG is a leading, global, full-service investment banking and capital markets firm that provides advisory, sales and trading, research and wealth management services. With more than 40 offices around the world, we offer insights and expertise to investors, companies and governments.
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements about our future and statements that are not historical facts. These forward‐looking statements are typically identified by such words as “believe,” “expect,” “anticipate,” “may,” “intend,” “outlook,” “will,” “estimate,” “forecast,” “project,” “should,” and other similar words and expressions, and are subject to numerous assumptions, risks and uncertainties, which will change over time. Forward-looking statements may contain beliefs, goals, intentions and expectations regarding revenues, earnings, operations, arrangements and other results, and may include statements of future performance, plans, and objectives. Forward-looking statements also include statements pertaining to our strategies for future development of our businesses and products. Forward‐looking statements speak only as of the date they are made; we do not assume any duty, and do not undertake, to update any forward‐looking statements. Furthermore, because forward‐looking statements represent only our belief regarding future events, many of which by their nature are inherently uncertain, the actual results or outcomes may differ, possibly materially, from the anticipated results or outcomes indicated in these forward-looking statements. Information regarding important factors, including Risk Factors that could cause actual results or outcomes to differ, perhaps materially, from those in our forward-looking statements is contained in reports we file with the SEC. You should read and interpret any forward-looking statement together with reports we file with the SEC. Past performance may not be indicative of future results. Different types of investments involve varying degrees of risk. Therefore, it should not be assumed that future performance of any specific investment or investment strategy will be profitable or equal the corresponding indicated performance level(s).
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For inquiries, please contact:
Jonathan Freedman
Head of Marketing and Communications
Jefferies Financial Group Inc.
mediacontact@jefferies.com
Source: Jefferies Financial Group Inc.
FAQ
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