Atlanticus Closes $50 Million Offering of Senior Notes
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Insights
The recent announcement by Atlanticus Holdings Corporation of the successful closure of its $50 million offering of 9.25% Senior Notes due 2029 is a significant financial event. The net proceeds of approximately $48.3 million, after accounting for underwriting discounts and commissions, indicate a strong market appetite for the company's debt securities. It's important to note the relatively high interest rate, which suggests a risk premium that investors demand for the long-term commitment of their capital to the company.
From an investment perspective, the option granted to underwriters to purchase an additional $7.5 million aggregate principal amount of the Notes could potentially dilute the value if exercised, yet it also provides a buffer for additional capital. The intended use of proceeds for redeeming a portion of Class B preferred units and general corporate purposes is a strategic move that could optimize Atlanticus's capital structure and possibly reduce cost of capital.
The listing of the new Senior Notes on the Nasdaq under the symbol 'ATLCZ' is a strategic decision that enhances the visibility of Atlanticus's financial instruments among investors. This could lead to increased trading liquidity and a more diversified investor base. Given the current economic climate, the fixed income market is sensitive to interest rate changes and the 9.25% yield on these notes is competitive, potentially attracting yield-seeking investors.
Moreover, the involvement of multiple book-running managers and co-managers, such as B. Riley Securities and William Blair & Co., underscores the offering's importance and the effort to ensure broad market reach. The legal counsel's role in ensuring compliance with SEC regulations is crucial for the legitimacy of the offering and instills confidence among potential investors.
The Offering's adherence to SEC regulations, as evidenced by the use of an effective shelf registration statement on Form S-3, is a critical aspect of this financial event. The legal framework governing such offerings ensures transparency and protects investors, which is essential for maintaining market integrity. The explicit mention that the offering shall not constitute an offer to sell or the solicitation of an offer to buy in any jurisdiction where it would be unlawful, highlights the company's compliance with state and federal securities laws.
Furthermore, the engagement of specialized legal counsel for both the company and the underwriters demonstrates due diligence and the importance of navigating complex securities regulations effectively. It provides an additional layer of assurance to investors regarding the legal soundness of the transaction.
ATLANTA, Jan. 30, 2024 (GLOBE NEWSWIRE) -- Atlanticus Holdings Corporation (NASDAQ: ATLC) (“Atlanticus,” “the Company”, “we,” “our” or “us”), a financial technology company that enables its bank, retail and healthcare partners to offer more inclusive financial services to millions of everyday Americans, today announced the closing of its previously announced underwritten registered public offering (the “Offering”) of
The Company granted the underwriters a 30-day option to purchase up to an additional
The Company expects to use the net proceeds of this Offering to redeem a portion of the Class B preferred units issued by one of the Company’s subsidiaries and/or for general corporate purposes.
The Notes have been approved for listing on the Nasdaq Global Select Market (“Nasdaq”) under the symbol “ATLCZ” and are expected to begin Nasdaq trading on January 31, 2024.
B. Riley Securities, Inc., Janney Montgomery Scott LLC, Ladenburg Thalmann & Co. Inc., William Blair & Co., L.L.C., and BTIG, LLC acted as book-running managers for the Offering. Brownstone Investment Group, LLC acted as co-manager for the Offering.
Troutman Pepper Hamilton Sanders LLP acted as legal counsel to the Company. Duane Morris LLP acted as legal counsel to the underwriters.
The Offering of these Notes was made pursuant to an effective shelf registration statement on Form S-3, which was initially filed with the Securities and Exchange Commission (the “SEC”) on May 6, 2021 and declared effective by the SEC on May 13, 2021. The Offering was made only by means of a prospectus and prospectus supplement. A copy of the prospectus and prospectus supplement relating to these securities may be obtained from the website of the SEC at http://www.sec.gov or by contacting: B. Riley Securities, Inc., 1300 17th Street North, Suite 1300, Arlington, Virginia 22209, Attn: Prospectus Department, Email: prospectuses@brileyfin.com, Telephone: (703) 312-9580.
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 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 jurisdiction.
About Atlanticus Holdings Corporation
Empowering Better Financial Outcomes for Everyday Americans
Atlanticus’ technology allows bank, retail, and healthcare partners to offer more inclusive financial services to everyday Americans through the use of proprietary analytics. We apply the experience gained and infrastructure built from servicing over 18 million customers and
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You generally can identify these statements by the use of words such as “outlook,” “potential,” “continue,” “may,” “seek,” “approximately,” “predict,” “believe,” “expect,” “plan,” “intend,” “estimate” or “anticipate” and similar expressions or the negative versions of these words or comparable words, as well as future or conditional verbs such as “will,” “should,” “would,” “likely” and “could.” These statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those included in the forward-looking statements. These risks and uncertainties include those risks described in the Company’s filings with the Securities and Exchange Commission and include, but are not limited to, risks related to the uncertain economic environment, particularly the impact of inflation, interest rates, labor availability and supply chains; the Company’s ability to retain existing, and attract new, merchant partners and funding sources; increases in loan delinquencies; its ability to operate successfully in a highly regulated industry; the outcome of litigation and regulatory matters; the effect of management changes; cyberattacks and security vulnerabilities in its products and services; and the Company’s ability to compete successfully in highly competitive markets. The forward-looking statements speak only as of the date on which they are made, and, except to the extent required by federal securities laws, the Company disclaims any obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. In light of these risks and uncertainties, there is no assurance that the events or results suggested by the forward-looking statements will in fact occur, and you should not place undue reliance on these forward-looking statements.
Contact:
Investor Relations
(770) 828-2000
investors@atlanticus.com
FAQ
What is the purpose of the $50 million aggregate principal amount of 9.25% Senior Notes due 2029?
Where are the Notes expected to be listed?
When was the shelf registration statement on Form S-3 filed with the SEC?
