NEW YORK - Equitable Holdings, Inc. (NYSE: NYSE:EQH), a prominent financial services holding company, announced today the initiation of a tender offer to repurchase up to $500 million of its outstanding debt securities. The offer targets several notes with varying priorities and capped amounts for each series, as outlined in their recent statement.
The securities involved include 4.572% Senior Notes due 2029, 7.000% Senior Debentures due 2028, and 5.000% Senior Notes due 2048, each with a specified Series Cap. The tender offer adheres to an Acceptance Priority Level, with the 4.572% Senior Notes due 2029 given the highest priority.
This tender offer coincides with the company's strategic financial management, including the settlement of new Pre-Capitalized Trust Securities by Pine Street Trust III and the sale of associated Eligible Assets. Notably, the offer is contingent on the successful completion of these transactions, termed the Financing Condition.
The buyback strategy follows Equitable Holdings' 2019 move to enhance its liquidity through the issuance of pre-capitalized trust securities. As part of this financial maneuvering, the company is set to issue $600 million in 2029 Notes in exchange for Eligible Assets, waive its repurchase rights, and dissolve Trust I, distributing the 2029 Notes to the holders of the 2029 pre-capitalized trust securities.
Holders of the targeted notes have until July 2, 2024, to respond to the tender offer, with an Early Tender Deadline set for June 14, 2024, offering an Early Tender Premium for those who act swiftly. The purchase price will be determined by a fixed spread over the yield of corresponding U.S. Treasury Securities, with the final amounts to be calculated on June 17, 2024.
The repurchase program is part of Equitable Holdings' broader approach to managing its debt maturity profile and providing liquidity to participating holders. It also underscores the company's ongoing strategy to manage capital cost-effectively.
The tender offer is not a guarantee of purchase but is subject to certain conditions, including the Maximum Aggregate Purchase Price and the Series Cap. Equitable Holdings reserves the right to amend the terms of the offer, including the Series Cap and Maximum Aggregate Purchase Price, at its discretion.
The information provided in this article is based on a press release statement from Equitable Holdings.
InvestingPro Insights
In light of Equitable Holdings, Inc.'s (NYSE: EQH) recent announcement regarding its tender offer to repurchase outstanding debt securities, several metrics and insights from InvestingPro may offer investors a clearer picture of the company's financial health and strategic direction.
InvestingPro Data highlights that Equitable Holdings has a market capitalization of approximately $13.49 billion, with a P/E ratio of 12.3, reflecting its current earnings compared to its share price. Notably, the adjusted P/E ratio for the last twelve months as of Q1 2024 is slightly lower at 11.64, suggesting a potentially more favorable valuation. Additionally, the company's Price / Book ratio stands at 28.71 for the same period, indicating a high valuation in terms of its net asset value.
Among the key InvestingPro Tips, it's worth noting that the management of Equitable Holdings has been actively buying back shares, which can be a sign of confidence in the company's future prospects and a commitment to returning value to shareholders. Furthermore, the company has demonstrated a solid track record of increasing its dividend for six consecutive years, which may appeal to income-focused investors.
InvestingPro also identifies that Equitable Holdings has experienced a strong return over the last year, with a one-year price total return of 64.66%. This performance is in line with the company trading near its 52-week high, with the price at 99.64% of this level. Such metrics may interest investors looking for companies with positive momentum in their share price.
For those considering a deeper dive into Equitable Holdings' financials and strategic initiatives, InvestingPro offers additional insights. There are 11 more InvestingPro Tips available, which could provide further context and analysis on the company's performance and outlook. Investors can access these tips by visiting https://www.investing.com/pro/EQH and can benefit from an additional 10% off a yearly or biyearly Pro and Pro+ subscription using the coupon code PRONEWS24.
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