Pagaya Announces Public Offering of Class A Ordinary Shares
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Insights
When a company announces a public offering of shares, it is typically a strategic move to raise capital. In this case, Pagaya Technologies Ltd.'s decision to offer 6,500,000 Class A ordinary shares can be an indicator of the company's need for liquidity or desire to fund growth initiatives. The additional option for underwriters to purchase up to 975,000 shares suggests confidence in the offering's success, potentially indicating a positive market sentiment towards Pagaya.
Investors will be interested in the utilization of the net proceeds, which are earmarked for 'general corporate purposes and to support future growth.' This broad description warrants scrutiny, as the specifics of these investments can significantly affect the company's financial trajectory. The involvement of reputable financial institutions as active joint book-running managers and co-managers, such as Citigroup and Jefferies, can be seen as a vote of confidence in the offering's management.
However, it's crucial to consider the dilutive effect on existing shareholders. The increase in outstanding shares can lead to earnings per share dilution if the capital raised does not result in a proportional increase in net income. Market reaction to such offerings can be mixed, depending on the perceived value of the investment for which the capital is raised.
From a market perspective, Pagaya Technologies Ltd.'s public offering can reflect broader trends in the financial technology sector. AI infrastructure is a rapidly growing field and companies like Pagaya are at the forefront of innovation. The success of this offering could signal to the market that investors are eager to support companies that are leveraging AI to disrupt traditional financial ecosystems.
It is also important to monitor the market conditions at the time of the offering. If market conditions are favorable, Pagaya might secure better terms and pricing for their shares, which can be beneficial for both the company and the investors. Conversely, in a bear market, the offering might be priced lower, potentially leading to less capital raised than anticipated.
The legal framework surrounding a public offering is complex and requires compliance with regulatory requirements. Pagaya's use of a shelf registration statement allows them to prepare the offering documents in advance and go to market quickly when conditions are favorable. This is a common strategy for companies looking to have the flexibility to time their offerings to market conditions.
Investors should be aware that the prospectus and prospectus supplement will contain critical information, including risk factors and detailed use of proceeds. These documents are key to understanding the legal and financial implications of the offering. The SEC's role in reviewing these documents is to ensure transparency and protect investor interests.
Citigroup and Jefferies are active joint book-running managers of the Offering. Keefe, Bruyette & Woods, A Stifel Company is a book-runner of the Offering. B. Riley Securities is acting as a co-manager of the Offering.
The Offering is being made pursuant to an effective shelf registration statement on Form F-3, filed with the Securities and Exchange Commission (“SEC”) on October 4, 2023, with an effective date of October 16, 2023. The Offering will be made only by means of a prospectus supplement and the accompanying prospectus. Before investing, prospective investors should read the prospectus, the prospectus supplement and the documents incorporated by reference therein for more complete information about the Company and the Offering. These documents may be obtained for free by visiting the SEC’s website at www.sec.gov. Alternatively, copies of the prospectus supplement and accompanying prospectus, when available, may be obtained from: Citigroup Global Markets Inc., c/o Broadridge Financial Solutions, 1155 Long Island Avenue,
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 Pagaya Technologies
Pagaya (NASDAQ: PGY) is a global technology company making life-changing financial products and services available to more people nationwide. By using machine learning, a vast data network and a sophisticated AI-driven approach, Pagaya provides comprehensive consumer credit and residential real estate solutions for its partners, their customers, and investors. Its proprietary API and capital solutions integrate into its network of partners to deliver seamless user experiences and greater access to the mainstream economy. Pagaya has offices in
Cautionary Note About Forward-Looking Statements
This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that involve risks and uncertainties. These forward-looking statements generally are identified by the words “anticipate,” “believe,” “continue,” “can,” “could,” “estimate,” “expect,” “intend,” “may,” “opportunity,” “future,” “strategy,” “might,” “outlook,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “strive,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. These statements are based on the Company’s current beliefs and expectations. Such forward-looking statements include, but are not limited to, statements relating to the offering, including the timing and size of the offering and the anticipated use of proceeds therefrom and the grant of the underwriters’ 30-day option to purchase additional shares. Actual results may differ from those set forth in this press release due to the risks and uncertainties associated with market conditions and the satisfaction of customary closing conditions related to the proposed public offering and the other risks and uncertainties described in the Company’s filings with the SEC, included under the heading “Risk Factors” in the Company’s Annual Report on Form 20-F and any subsequent filings with the SEC. These forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These forward-looking statements reflect the Company’s views with respect to future events as of the date hereof and are based on assumptions and subject to risks and uncertainties. Given these uncertainties, investors should not place undue reliance on these forward-looking statements. The forward-looking statements made as of the date hereof reflect the Company’s current beliefs and are based on information currently available as of the date they are made, and the Company assumes no obligation and does not intend to update these forward-looking statements. All forward-looking statements are qualified in their entirety by this cautionary statement, which is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
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Source: Pagaya Technologies Ltd.
FAQ
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