LITTLE ROCK - Uniti Group Inc. (NASDAQ:UNIT), a real estate investment trust specializing in communication infrastructure, announced today its intention to offer $300 million in 10.50% Senior Secured Notes due 2028. The offering hinges on market conditions and other factors.
The notes, to be guaranteed by Uniti and its subsidiaries, will be secured by first-priority liens on most of the issuers' and guarantors' assets. These liens also secure Uniti's existing secured notes and senior secured credit facility. Regulatory approval will be sought within 60 days post-issuance to include guarantees from regulated subsidiaries.
If issued, the notes could be exchanged for additional notes under the same terms as the existing 10.50% Senior Secured Notes due 2028. The proceeds are earmarked for general corporate purposes, potentially including funding part of the cash consideration for Uniti's proposed merger with Windstream.
The merger's completion is contingent on various conditions and would follow the closing of the notes offering. The successful issuance of the notes would nullify the need for a previously announced $300 million bridge facility related to the merger.
Uniti, which owns approximately 141,000 fiber route miles and 8.5 million fiber strand miles, did not offer the notes for sale in any jurisdiction where such action would be unlawful prior to registration or qualification under local securities laws.
This news is based on a press release statement.
InvestingPro Insights
As Uniti Group Inc. (NASDAQ:UNIT) makes headlines with its latest financial maneuver, investors are keeping a close eye on the company's market performance. With a market capitalization of $1.07 billion, Uniti shows a significant presence in the communication infrastructure sector. Despite recent challenges, the company's net income is expected to grow this year, which could signal a potential turnaround for investors considering the stock.
InvestingPro data highlights that Uniti is trading at a low EBITDA valuation multiple, with an EBITDA of $884.08 million over the last twelve months as of Q1 2024. This could indicate that the stock is undervalued relative to its earnings before interest, taxes, depreciation, and amortization—a key metric that investors often look at when assessing company value. Additionally, the company's gross profit margin stands at an impressive 86.05%, showcasing its ability to retain a significant portion of revenue after accounting for the cost of goods sold.
InvestingPro Tips suggest that Uniti's stock has taken a considerable hit over the last week, with a 1-week price total return of -22.11%. This could be a reflection of market reactions to the recent notes offering or other external factors. Despite this, the stock's recent entry into oversold territory, as indicated by the Relative Strength Index (RSI), may attract investors looking for potential buying opportunities.
For those looking to delve deeper into Uniti's financials and future outlook, InvestingPro offers additional insights and tips. Currently, there are 11 more InvestingPro Tips available for Uniti, which can be accessed by visiting https://www.investing.com/pro/UNIT. Moreover, investors can take advantage of an exclusive offer using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, providing even more valuable insights to inform their investment decisions.
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