PRA Group Announces Pricing of Offering of $400.0 Million of 8.875% Senior Notes due 2030
Rhea-AI Summary
PRA Group announced the pricing of $400 million in 8.875% Senior Notes due 2030, set to close around May 20, 2024. The notes, offered privately to qualified institutional buyers, are aimed to repay $396 million in outstanding borrowings under the North American revolving credit facility. Subsequently, the company plans to use this facility to redeem $298 million of its 7.375% Senior Notes due 2025, along with accrued interest, by September 1, 2024. The notes will be guaranteed by PRA Group's existing and future domestic subsidiaries under the North American Credit Agreement.
Positive
- PRA Group successfully priced $400 million of 8.875% Senior Notes due 2030.
- Notes are high-yielding at 8.875%, which might attract investors.
- Proceeds will repay $396 million of existing borrowings, potentially improving liquidity.
- Subsequent redemption of $298 million 7.375% Senior Notes due 2025 can lower future interest expenses.
- Notes to be guaranteed by existing and future domestic subsidiaries, reducing default risk.
Negative
- High interest rate of 8.875% indicates a higher cost of borrowing.
- Significant reliance on debt refinancing points to potential cash flow issues.
- Notes offered privately, limiting broader market transparency.
- Future obligations under North American Revolver may affect financial flexibility.
- High leverage due to consecutive refinancing may raise concerns among investors.
News Market Reaction – PRAA
In the trading session that priced this news, PRAA declined 1.42%, reflecting a mild negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
AI-generated analysis. How Rhea-AI works. Not financial advice.
The notes will be guaranteed on a senior unsecured basis by each of the Company's existing and future domestic subsidiaries that is a borrower or guarantor under the Company's North American Credit Agreement.
PRA Group intends to use the net proceeds from the offering to repay approximately
The notes were offered only to qualified institutional buyers in reliance on Rule 144A under the Securities Act and to certain persons outside of
This announcement is neither an offer to sell, nor a solicitation of an offer to buy, any of these securities and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale is unlawful. Any offer of these securities will be made only by means of a private offering memorandum. The offer and sale of the notes have not been and will not be registered under the Securities Act or any state securities laws, and unless so registered, the notes may not be offered or sold in
About PRA Group, Inc.
As a global leader in acquiring and collecting nonperforming loans, PRA Group, Inc. returns capital to banks and other creditors to help expand financial services for consumers in the
About Forward-Looking Statements
Statements made herein that are not historical in nature, including PRA Group, Inc.'s or its management's intentions, hopes, beliefs, expectations, representations, projections, plans or predictions of the future, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.
The forward-looking statements in this press release are based upon management's current beliefs, estimates, assumptions and expectations of PRA Group, Inc.'s future operations and financial and economic performance, taking into account currently available information. These statements are not statements of historical fact or guarantees of future performance, and there can be no assurance that anticipated events will transpire or that the Company's expectations will prove to be correct. Forward-looking statements involve risks and uncertainties, some of which are not currently known to PRA Group, Inc. Actual events or results may differ materially from those expressed or implied in any such forward-looking statements as a result of various factors, including risk factors and other risks that are described from time to time in PRA Group, Inc.'s filings with the Securities and Exchange Commission, including PRA Group, Inc.'s annual reports on Form 10-K, its quarterly reports on Form 10-Q and its current reports on Form 8-K, which are available through PRA Group, Inc.'s website and contain a detailed discussion of PRA Group, Inc.'s business, including risks and uncertainties that may affect future results.
Due to such uncertainties and risks, you are cautioned not to place undue reliance on such forward-looking statements, which speak only as of today. Information in this press release may be superseded by more recent information or statements, which may be disclosed in later press releases, subsequent filings with the Securities and Exchange Commission or otherwise. Except as required by law, PRA Group, Inc. assumes no obligation to publicly update or revise its forward-looking statements contained herein to reflect any change in PRA Group, Inc.'s expectations with regard thereto or to reflect any change in events, conditions or circumstances on which any such forward-looking statements are based, in whole or in part.
Investor Contact:
Najim Mostamand, CFA
Vice President, Investor Relations
(757) 431-7913
IR@PRAGroup.com
News Media Contact:
Elizabeth Kersey
Senior Vice President, Communications and Public Policy
(757) 641-0558
Elizabeth.Kersey@PRAGroup.com
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SOURCE PRA Group, Inc.