CoreCivic Announces Closing of $450 Million 8.25% Senior Notes Due 2026

Rhea-AI Summary

CoreCivic, Inc. (NYSE: CXW) closed a $450 million offering of 8.25% senior unsecured notes due 2026 on April 14, 2021, priced at 99% of face value, yielding 8.50%. Net proceeds of approximately $435.1 million will be used to redeem $250 million of its 5.00% senior notes due 2022 and to repay $128 million of its 4.625% senior notes due 2023. The offering was made under a shelf registration statement and is subject to standard risks. The company aims to enhance its financial position by reducing debt obligations.

Positive

• Successfully closed $450 million offering at an effective yield of 8.50%.
• Redemption of $250 million of 5.00% senior notes improves financial obligations.
• Use of proceeds to repay $128 million of 4.625% senior notes due 2023.

Negative

• None.

BRENTWOOD, Tenn., April 15, 2021 (GLOBE NEWSWIRE) -- CoreCivic, Inc. (NYSE: CXW) (the “Company") closed its offering of $450,000,000 aggregate principal amount of 8.25% senior unsecured notes due 2026 (the “Notes”) on April 14, 2021. The Notes were priced at 99.0% of face value and have an effective yield to maturity of 8.50%. The aggregate net proceeds from the sale of the Notes are expected to be approximately $435.1 million, after deducting the original issuance and underwriting discounts and estimated offering expenses. CoreCivic is using a significant amount of the net proceeds from the offering of the Notes (i) to redeem all $250 million principal amount of its outstanding 5.00% senior notes due 2022 (the “2022 Senior Notes”), which have been called for redemption on May 14, 2021 by a redemption notice issued on April 14, 2021, including the payment of the applicable make-whole amount and accrued interest, and (ii) to otherwise repay or reduce its other indebtedness, which includes repurchasing approximately $128 million principal amount of the $350 million aggregate principal amount of 4.625% senior notes due 2023 (the “2023 Senior Notes”). Following the repurchases of the 2023 Senior Notes described in the preceding sentence, the outstanding principal balance of the 2023 Senior Notes will be approximately $222 million. CoreCivic may use any remaining proceeds for general corporate purposes.

Imperial Capital acted as left lead underwriter, StoneX Financial Inc. acted as joint bookrunner, and Wedbush Securities Inc. acted as co-manager for the offering.

The Notes were offered pursuant to CoreCivic’s effective shelf registration statement on Form S-3ASR, which became effective upon filing with the Securities and Exchange Commission on April 6, 2021. A prospectus supplement describing the terms of the offering has been filed with the Securities and Exchange Commission and is available at www.sec.gov. The offering may be made only by means of a prospectus supplement and the accompanying prospectus. Copies of the prospectus supplement and accompanying prospectus relating to this offering may be obtained at Imperial Capital, LLC, 10100 Santa Monica Boulevard, Suite 2400, Los Angeles, CA 90067, Attn: Prospectus Department, or by telephone at (310) 246-3700.

This press release is neither an offer to sell nor a solicitation of an offer to buy any securities, nor shall it constitute a notice of redemption under the indenture governing the 2022 Senior Notes or the indenture governing the 2023 Senior Notes, nor shall there be any offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale would be unlawful.

This press release includes forward-looking statements regarding CoreCivic’s intended use of the remaining net proceeds from the issuance of the Notes. These forward-looking statements may be affected by risks and uncertainties in CoreCivic’s business and market conditions. This information is qualified in its entirety by cautionary statements and risk factor disclosures contained in CoreCivic’s Securities and Exchange Commission filings, including CoreCivic’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed with the Securities and Exchange Commission on February 22, 2021, as well as the risks identified in the prospectus supplement and the accompanying prospectus relating to the offering. CoreCivic wishes to caution readers that certain important factors may have affected and could in the future affect CoreCivic’s actual results and could cause CoreCivic’s actual results for subsequent periods to differ materially from those expressed in any forward-looking statement made by or on behalf of CoreCivic, including the risk that the offering of the Notes cannot be successfully completed. CoreCivic undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date hereof.

About CoreCivic

CoreCivic is a diversified government solutions company with the scale and experience needed to solve tough government challenges in flexible, cost-effective ways. CoreCivic provides a broad range of solutions to government partners that serve the public good through corrections and detention management, a network of residential reentry centers to help address America’s recidivism crisis, and government real estate solutions. CoreCivic is the nation’s largest owner of partnership correctional, detention and residential reentry facilities, and believes it is the largest private owner of real estate used by government agencies in the U.S. CoreCivic has been a flexible and dependable partner for government for more than 35 years. CoreCivic’s employees are driven by a deep sense of service, high standards of professionalism and a responsibility to help government better the public good.

Contact:

Investors: Cameron Hopewell - Managing Director, Investor Relations - (615) 263-3024 Media: Steve Owen - Vice President, Communications - (615) 263-3107

FAQ

What was the purpose of CoreCivic's $450 million bond offering?

CoreCivic's $450 million bond offering is primarily aimed at redeeming its 5.00% senior notes due 2022 and repaying other indebtedness.

When will CoreCivic redeem its 5.00% senior notes due 2022?

CoreCivic will redeem its 5.00% senior notes due 2022 on May 14, 2021.

What is the yield on the new senior unsecured notes issued by CoreCivic?

The new senior unsecured notes have an effective yield to maturity of 8.50%.

What are the implications of CoreCivic's offering for its financial health?

The offering is intended to improve CoreCivic's financial health by reducing higher-interest debt obligations.

How much of the proceeds from the offering will be used to repay other debts?

Approximately $128 million of the proceeds will be used to repurchase part of the 4.625% senior notes due 2023.