NEW YORK - Rithm Capital Corp. (NYSE:RITM), a global asset manager, has announced its plan to offer $775 million of senior unsecured notes due in 2029. The company specified that the proceeds from this debt issuance will be allocated primarily to debt reduction efforts. Specifically, Rithm Capital aims to repurchase up to $275 million of its 6.250% senior unsecured notes set to mature in 2025. The remaining funds will be directed towards general corporate purposes.
The offering of these notes will be conducted under specific conditions as they have not been registered under the U.S. Securities Act of 1933 or any state securities laws. Therefore, the sale of the notes will be restricted to qualified institutional buyers within the United States according to Rule 144A of the Securities Act, and to non-U.S. persons outside of the United States under Regulation S of the same act.
Rithm Capital, which operates with a focus on real estate, credit, and financial services, has a history of direct investments and also runs wholly-owned businesses including Sculptor Capital Management (NYSE:SCU), Inc., Newrez LLC, and Genesis Capital LLC. The company, which was established in 2013, has been organized to conduct operations that qualify as a real estate investment trust (REIT) for federal income tax purposes.
This news article is based on the press release statement from Rithm Capital Corp.
InvestingPro Insights
In light of Rithm Capital Corp.'s recent announcement regarding their senior unsecured notes offering, insights from InvestingPro reveal some interesting metrics and tips for investors considering the company's financial health and investment potential. As of the last twelve months as of Q4 2023, Rithm Capital has a market capitalization of $5.31 billion and a price-to-earnings (P/E) ratio of 9.55, which suggests that the company's stock may be reasonably valued relative to its earnings.
InvestingPro Data indicates that Rithm Capital has a robust dividend yield of 9.11%, a compelling figure for income-focused investors. The company has also demonstrated a strong commitment to shareholder returns, maintaining dividend payments for 11 consecutive years. Additionally, the stock is trading near its 52-week high, with the price at 98.48% of this peak, indicating investor confidence may be high.
InvestingPro Tips highlight that analysts have revised their earnings expectations upwards for the upcoming period, which could signal potential growth or stability in the company's financial performance. Furthermore, with the analysts predicting profitability for the year, investors might see this as a positive sign of the company's future prospects. For investors seeking more in-depth analysis and additional tips, there are 6 more InvestingPro Tips available, which can be accessed through the InvestingPro platform. For those interested, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
The decision by Rithm Capital to allocate proceeds from the debt issuance towards debt reduction aligns with a prudent financial strategy, potentially strengthening the company's balance sheet and future financial flexibility. Investors might view this as a positive step towards enhancing the company's credit profile and long-term value creation.
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