Cushman & Wakefield Successfully Reprices 2030 Term Loan; Completes Prepayment to Fully Extinguish 2025 Term Loan

Rhea-AI Summary

Cushman & Wakefield (NYSE: CWK) has successfully repriced approximately $1.0 billion of its Term Loan due 2030, reducing the interest rate by 50 basis points from Term SOFR plus 3.75% to Term SOFR plus 3.25%. The maturity and other terms remain substantially unchanged.

Additionally, the company has fully extinguished its 2025 Term Loan through prepayments, including a $48 million payment on October 1, 2024, and a $50 million payment in August 2024. This brings the total debt repayment for the year to $200 million.

With these actions, Cushman & Wakefield now has no funded debt maturities until 2028, positioning the company to capitalize on market growth opportunities as the commercial real estate market recovers.

Positive

• Successful repricing of $1.0 billion Term Loan, reducing interest rate by 50 basis points
• Full extinguishment of 2025 Term Loan ahead of schedule
• Total debt repayment of $200 million year-to-date
• No funded debt maturities until 2028, improving financial flexibility

Negative

• None.

Insights

Financial Analyst

Cushman & Wakefield's recent financial maneuvers demonstrate a proactive approach to debt management and cost reduction. The 50 basis point reduction in the interest rate for their $1.0 billion Term Loan due 2030 will result in significant interest savings over the loan's lifetime. This repricing, combined with the early repayment of the 2025 term loan, showcases the company's strong cash flow position and ability to optimize its capital structure.

The total debt repayment of $200 million year-to-date is a positive indicator of the company's financial health and commitment to deleveraging. By fully extinguishing the 2025 debt tranche, C&W has effectively pushed out its nearest debt maturity to 2028, providing enhanced financial flexibility and reducing near-term refinancing risk.

These actions should improve the company's interest coverage ratios and free up capital for potential growth initiatives or shareholder returns. The market's willingness to support these repricings suggests confidence in C&W's financial outlook, which is particularly noteworthy given the current challenges in the commercial real estate sector. This positions the company well to capitalize on a potential market recovery, potentially leading to improved profitability and shareholder value in the medium to long term.

CHICAGO--(BUSINESS WIRE)-- Cushman & Wakefield (NYSE: CWK) announced that it has successfully completed a repricing of approximately $1.0 billion of its Term Loan issued in April 2024 due 2030 (“Term Loan”). The repricing reduces the applicable interest rate on the Term Loan by 50 basis points from Term SOFR plus 3.75% to Term SOFR plus 3.25%. There are no changes to the maturity of the Term Loan following this repricing and all other terms are substantially unchanged. Additionally, on October 1, 2024, the Company elected to prepay the remaining $48 million of its term loan due 2025. Combined with the Company's August 2024 prepayment of $50 million of its term loan due 2025, the October payment brings the aggregate year-to-date debt repayment total to $200 million. The Company has now repaid in full the outstanding 2025 tranche and has no funded debt maturities until 2028.

“We have repaid our 2025 debt maturities well ahead of schedule and have completed three term loan debt repricings this year. These successful transactions highlight the excellent work our teams have done on driving free cash flow improvements and executing on our strategic priorities. We appreciate the strong market demand and lender support for our repricing,” said Neil Johnston, Chief Financial Officer. “With no near-term debt maturities, the Company is in a strong position to capitalize on market growth opportunities as the commercial real estate market recovers.”

About Cushman & Wakefield

Cushman & Wakefield (NYSE: CWK) is a leading global commercial real estate services firm for property owners and occupiers with approximately 52,000 employees in nearly 400 offices and 60 countries. In 2023, the firm reported revenue of $9.5 billion across its core services of property, facilities and project management, leasing, capital markets, and valuation and other services. It also received numerous industry and business accolades for its award-winning culture and commitment to Diversity, Equity and Inclusion (DEI), sustainability and more. For additional information, visit www.cushmanwakefield.com.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements. These statements can be identified by the fact that they do not relate strictly to historical or current facts, and you can often identify these forward-looking statements by the use of forward-looking words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “strives,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” “target,” “goal,” “projects,” “forecasts,” “shall,” “contemplates” or the negative version of those words or other comparable words. Any forward-looking statements contained in this press release are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity.

There are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statements and should consider the factors discussed in Cushman & Wakefield's annual report on Form 10-K for the year ended December 31, 2023, including those discussed under “Item 1A—Risk Factors” therein.

The forward-looking statements included in this press release are made as of the date hereof, and except as required by law, Cushman & Wakefield undertakes no obligation to update, amend or clarify any forward-looking statements to reflect events, new information or circumstances occurring after the date of this press release.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241010338458/en/

Aixa Velez

Corporate Communications

+1 312 424 8195

aixa.velez@cushwake.com

Source: Cushman & Wakefield

FAQ

What is the new interest rate for Cushman & Wakefield's (CWK) 2030 Term Loan after repricing?

After repricing, the new interest rate for Cushman & Wakefield's 2030 Term Loan is Term SOFR plus 3.25%, reduced from Term SOFR plus 3.75%.

How much debt has Cushman & Wakefield (CWK) repaid in total for the year 2024?

Cushman & Wakefield has repaid a total of $200 million in debt for the year 2024.

When is Cushman & Wakefield's (CWK) next funded debt maturity after repaying the 2025 Term Loan?

After repaying the 2025 Term Loan, Cushman & Wakefield's next funded debt maturity is in 2028.

How much of the 2025 Term Loan did Cushman & Wakefield (CWK) prepay on October 1, 2024?

Cushman & Wakefield prepaid $48 million of its 2025 Term Loan on October 1, 2024.