Bread Financial™ Announces Partial Repurchase of 4.25% Convertible Senior Notes Due 2028
Bread Financial Holdings, Inc. (NYSE: BFH) has announced a partial repurchase of its 4.25% Convertible Senior Notes due 2028. The company has entered into privately negotiated agreements to repurchase $237.6 million aggregate principal amount of the Notes for an approximate cash price of $350.0 million. The final price is subject to adjustment based on the daily volume-weighted average price of BFH's common stock over an agreed measurement period starting August 9, 2024.
The repurchases are expected to close before the end of the current fiscal quarter. After the transaction, $78.6 million principal amount of Notes will remain outstanding from an initial balance of $316.25 million. The company's previously established capped call transactions related to the Notes issuance will remain in effect.
Bread Financial Holdings, Inc. (NYSE: BFH) ha annunciato un riacquisto parziale delle proprie Note Convertibili Senior al 4,25% in scadenza nel 2028. L'azienda ha stipulato accordi negoziati privatamente per riacquistare un ammontare aggregato di 237,6 milioni di dollari del capitale delle Note per un prezzo in contante approssimativo di 350,0 milioni di dollari. Il prezzo finale è soggetto a regolazione in base al prezzo medio ponderato per volume delle azioni ordinarie di BFH su un periodo di misurazione concordato che inizia il 9 agosto 2024.
I riacquisti dovrebbero chiudersi prima della fine dell'attuale trimestre fiscale. Dopo la transazione, rimarrà un ammontare di 78,6 milioni di dollari di Notes in circolazione su un saldo iniziale di 316,25 milioni di dollari. Le transazioni di capped call precedentemente stabilite dall'azienda relative all'emissione delle Notes rimarranno in vigore.
Bread Financial Holdings, Inc. (NYSE: BFH) ha anunciado la recompra parcial de sus Notas Senior Convertibles al 4,25% con vencimiento en 2028. La empresa ha celebrado acuerdos negociados de forma privada para recomprar un monto total de 237,6 millones de dólares del principal de las Notas por un precio en efectivo aproximado de 350,0 millones de dólares. El precio final está sujeto a ajustes basados en el precio promedio ponderado por volumen de las acciones ordinarias de BFH durante un período de medición acordado que comienza el 9 de agosto de 2024.
Se espera que las recompras cierren antes del final del trimestre fiscal actual. Después de la transacción, quedará un monto principal de 78,6 millones de dólares de Notas en circulación de un saldo inicial de 316,25 millones de dólares. Las transacciones de capped call previamente establecidas por la compañía relacionadas con la emisión de Notas seguirán vigentes.
Bread Financial Holdings, Inc. (NYSE: BFH)는 2028년 만기 4.25% 전환 선순위 채권의 부분 매입을 발표했습니다. 회사는 비공식 협상에 의한 계약을 통해 2억 3천 7백 60만 달러의 원금 규모를 3억 5천만 달러의 대략적인 현금 가격으로 매입하기로 합의했습니다. 최종 가격은 2024년 8월 9일부터 시작되는 합의된 측정 기간 동안 BFH의 보통주 일일 거래량 가중 평균 가격에 따라 조정될 수 있습니다.
리매입 거래는 현재 회계 분기 종료 전에 완료될 것으로 예상됩니다. 거래 후 7천 8백 60만 달러의 원금 규모의 채권이 3억 1천 6백 25만 달러의 초기 잔액에서 남아 있게 됩니다. 회사가 채권 발행과 관련하여 이전에 설정한 capped call 거래는 유효합니다.
Bread Financial Holdings, Inc. (NYSE: BFH) a annoncé un rachat partiel de ses Obligations Convertibles Senior à 4,25 % arrivant à échéance en 2028. L'entreprise a conclu des accords négociés en privé pour racheter un montant principal agrégé de 237,6 millions de dollars des Obligations pour un prix en espèces approximatif de 350,0 millions de dollars. Le prix final est sujet à ajustement en fonction du prix moyen pondéré par volume des actions ordinaires de BFH sur une période de mesure convenue commençant le 9 août 2024.
Les rachats devraient être finalisés avant la fin du trimestre fiscal actuel. Après la transaction, il restera un montant principal de 78,6 millions de dollars d'Obligations en circulation sur un solde initial de 316,25 millions de dollars. Les transactions de capped call établies auparavant par l'entreprise concernant l'émission des Obligations resteront en vigueur.
Bread Financial Holdings, Inc. (NYSE: BFH) hat einen teilweisen Rückkauf seiner 4,25% umwandlungsfähigen Senior-Anleihen mit Fälligkeit 2028 angekündigt. Das Unternehmen hat privat verhandelte Vereinbarungen zum Rückkauf eines aggregierten Nennbetrags von 237,6 Millionen Dollar der Anleihen zu einem ungefähren Barpreis von 350,0 Millionen Dollar getroffen. Der endgültige Preis unterliegt einer Anpassung basierend auf dem täglichen volumenweighted Durchschnittspreis der Stammaktien von BFH über einen vereinbarten Bewertungszeitraum, der am 9. August 2024 beginnt.
Die Rückkäufe sollen vor Ende des aktuellen Geschäftsjahres abgeschlossen werden. Nach der Transaktion verbleibt ein Nennbetrag von 78,6 Millionen Dollar an Anleihen aus einem anfänglichen Saldo von 316,25 Millionen Dollar. Die zuvor festgelegten capped call-Transaktionen des Unternehmens in Bezug auf die Emission der Anleihen bleiben in Kraft.
- Reduction of outstanding debt from $316.25 million to $78.6 million
- Potential improvement in the company's debt-to-equity ratio
- Demonstration of financial flexibility and liquidity to repurchase notes
- Cash outflow of approximately $350.0 million for the repurchase
- Potential dilution of existing shareholders if notes are converted to common stock
Insights
Bread Financial's decision to repurchase
The repurchase price being partially tied to the company's stock price adds an element of uncertainty to the final cost. This transaction will likely improve Bread Financial's debt-to-equity ratio, potentially enhancing its financial flexibility. However, investors should closely monitor the impact on the company's cash reserves and its ability to fund growth initiatives in the near term.
This partial repurchase of convertible notes by Bread Financial is a nuanced financial maneuver. By reducing outstanding notes from
Interestingly, the retention of capped call transactions indicates a hedging strategy against potential upside in the stock price. This complex transaction demonstrates sophisticated financial management but also raises questions about the optimal use of cash reserves in the current economic environment.
COLUMBUS, Ohio, Aug. 09, 2024 (GLOBE NEWSWIRE) -- Bread Financial Holdings, Inc. (NYSE: BFH) (“Bread Financial” or the “Company”) announced today that it has entered into separate, privately negotiated repurchase agreements with a limited number of holders of its
The Repurchases are expected to close shortly after completion of the measurement period, which is expected to be before the end of the current fiscal quarter, subject to the satisfaction of customary closing conditions. Following such closings, approximately
The Company had previously entered into capped call transactions with certain financial institutions in connection with the issuance of the Notes. All of these transactions are expected to remain in effect notwithstanding the Repurchases.
This news release shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. This news release shall not constitute an offer to purchase, or a redemption notice for, any of the Company’s outstanding Notes.
About Bread Financial™
Bread Financial Holdings, Inc. (NYSE: BFH) is a tech-forward financial services company providing simple, personalized payment, lending and saving solutions. The Company creates opportunities for its customers and partners through digitally enabled choices that offer ease, empowerment, financial flexibility and exceptional customer experiences. Driven by a digital-first approach, data insights and white-label technology, Bread Financial delivers growth for its partners through a comprehensive product suite, including private label and co-brand credit cards and buy now, pay later (BNPL) products such as installment loans and our "split-pay" offerings. Bread Financial also offers direct-to-consumer solutions that give customers more access, choice and freedom through its branded Bread Cashback™ American Express® Credit Card and Bread Savings™ products.
Headquartered in Columbus, Ohio, Bread Financial is powered by its 7,500+ global associates and is committed to sustainable business practices.
Forward-looking Statements
This news release contains forward-looking statements, including, but not limited to, statements related to the proposed refinancing transactions, the Convertible Notes offering, the capped call transactions and the Tender Offer described above. Forward-looking statements may otherwise generally be identified by the use of the words such as “believe,” “expect,” “anticipate,” “estimate,” “intend,” “project,” “plan,” “likely,” “may,” “should” or other words or phrases of similar import. Similarly, statements that describe our business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements we make regarding, and the guidance we give with respect to, our anticipated operating or financial results, future financial performance and outlook, future dividend declarations, and future economic conditions.
We believe that our expectations are based on reasonable assumptions. Forward-looking statements, however, are subject to a number of risks and uncertainties that are difficult to predict and, in many cases, beyond our control. Accordingly, our actual results could differ materially from the projections, anticipated results or other expectations expressed in this release, and no assurances can be given that our expectations will prove to have been correct. Factors that could cause the outcomes to differ materially include, but are not limited to, the following: macroeconomic conditions, including market conditions, inflation, higher interest rates, labor market conditions, recessionary pressures or a concern over a prolonged economic slowdown, and the related impact on consumer spending behavior, payments, debt levels, savings rates and other behavior; global political and public health events and conditions, including ongoing wars and military conflicts; future credit performance, including the level of future delinquency and write-off rates; the loss of, or reduction in demand from, significant brand partners or customers in the highly competitive markets in which we compete; the concentration of our business in U.S. consumer credit; inaccuracies in the models and estimates on which we rely, including the amount of our Allowance for credit losses and our credit risk management models; the inability to realize the intended benefits of acquisitions, dispositions and other strategic initiatives; our level of indebtedness and ability to access financial or capital markets; pending and future legislation, regulation, supervisory guidance, and regulatory and legal actions, including, but not limited to, those related to financial regulatory reform and consumer financial services practices, as well as any such actions with respect to late fees, interchange fees or other charges; impacts arising from or relating to the transition of our credit card processing services to third party service providers that we completed in 2022; failures or breaches in our operational or security systems, including as a result of cyberattacks, unanticipated impacts from technology modernization projects or otherwise; and any tax liability, disputes or other adverse impacts arising out of or relating to the spinoff of our former LoyaltyOne segment or the bankruptcy filings of Loyalty Ventures Inc. and certain of its subsidiaries. In addition, the Consumer Financial Protection Bureau (CFPB) has issued a final rule that, absent a successful legal challenge, will place significant limits on credit card late fees, which would have a significant impact on our business and results of operations for at least the short term and, depending on the effectiveness of the mitigating actions that we have taken or may in the future take in anticipation of, or in response to, the final rule, may potentially adversely impact us over the long term; we cannot provide any assurance as to the effective date of the rule, the result of any pending or future challenges or other litigation relating to the rule, or our ability to mitigate or offset the impact of the rule on our business and results of operations. The foregoing factors, along with other risks and uncertainties that could cause actual results to differ materially from those expressed or implied in forward-looking statements, are described in greater detail under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the most recently ended fiscal year, which may be updated in Item 1A of, or elsewhere in, our Quarterly Reports on Form 10-Q filed for periods subsequent to such Form 10-K. Our forward-looking statements speak only as of the date made, and we undertake no obligation, other than as required by applicable law, to update or revise any forward-looking statements, whether as a result of new information, subsequent events, anticipated or unanticipated circumstances or otherwise.
Brian Vereb — Investor Relations
Brian.Vereb@breadfinancial.com
Susan Haugen — Investor Relations
Susan.Haugen@breadfinancial.com
Rachel Stultz — Media
Rachel.Stultz@breadfinancial.com
FAQ
What is the principal amount of 4.25% Convertible Senior Notes that Bread Financial is repurchasing?
How much is Bread Financial (BFH) paying for the repurchase of the Notes?
When is the repurchase of Bread Financial's (BFH) Convertible Senior Notes expected to close?
How much of Bread Financial's (BFH) 4.25% Convertible Senior Notes will remain outstanding after the repurchase?
