Rithm Capital Corp. Announces Public Offering of Common Stock

Rhea-AI Summary

Rithm Capital Corp. (NYSE: RITM) has announced a public offering of 30,000,000 shares of its common stock, subject to market conditions. The company plans to grant underwriters a 30-day option to purchase up to an additional 4,500,000 shares. Rithm intends to use the net proceeds for general corporate purposes. The offering will be made through a shelf registration statement filed with the SEC.

Several major financial institutions, including Citigroup, Goldman Sachs & Co. , J.P. Morgan, UBS Investment Bank, BTIG, and Wells Fargo Securities, , are acting as joint book-running managers for the offering. The shares may be offered in negotiated transactions or otherwise, at prevailing market prices or related prices.

Positive

• Potential to raise significant capital through the offering of 30,000,000 shares
• Option for underwriters to purchase additional 4,500,000 shares, potentially increasing capital raised
• Involvement of major financial institutions as joint book-running managers

Negative

• Potential dilution of existing shareholders' ownership
• Possible downward pressure on stock price due to increased supply of shares

Insights

Financial Analyst

Rithm Capital's announcement of a public offering of 30 million shares, with an option for an additional 4.5 million, is a significant capital-raising event. This move will likely dilute existing shareholders' ownership but could strengthen the company's financial position. The use of proceeds for "general corporate purposes" provides flexibility but lacks specificity, which may concern some investors.

The involvement of major underwriters like Citigroup, Goldman Sachs and J.P. Morgan lends credibility to the offering. However, the timing and pricing strategy, described as "at market prices prevailing at the time of sale," suggests the company is opportunistically tapping the market, which could impact short-term stock price.

For a company with a market cap of $5.8 billion, this offering represents a substantial increase in outstanding shares. Investors should closely monitor how effectively management deploys this capital to generate returns and whether it aligns with the company's growth strategy or potential acquisitions in the real estate investment sector.

Market Research Analyst

This public offering by Rithm Capital could significantly impact the REIT sector. The size of the offering, potentially up to 34.5 million shares, indicates a substantial capital infusion. This move might be interpreted as Rithm positioning itself for market opportunities or preparing for challenging economic conditions.

The lack of specific use for the proceeds leaves room for speculation. It could signal upcoming acquisitions, debt repayment, or a buffer against market volatility. Competitors and investors will be watching closely to see how this capital deployment affects Rithm's market position and overall sector dynamics.

The offering's impact on Rithm's stock price and valuation metrics like price-to-book ratio will be important to monitor. Additionally, this move may influence other REITs to consider similar capital-raising strategies, potentially affecting sector-wide valuations and investment flows.

NEW YORK--(BUSINESS WIRE)-- Rithm Capital Corp. (NYSE: RITM; “Rithm” or the “Company”) announced today the commencement of a public offering of 30,000,000 shares of its common stock, subject to market conditions. In connection with the offering, the Company expects to grant the underwriters an option for a period of 30 days to purchase up to an additional 4,500,000 shares of common stock. The Company intends to use the net proceeds from this offering for general corporate purposes. The underwriters may offer the shares from time to time for sale in negotiated transactions or otherwise, at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices.

Citigroup, Goldman Sachs & Co. LLC, J.P. Morgan, UBS Investment Bank, BTIG and Wells Fargo Securities, LLC are acting as joint book-running managers for the offering.

The offering will be made pursuant to the Company’s effective shelf registration statement filed with the Securities and Exchange Commission (the “SEC”). The offering will be made only by means of a prospectus and a related prospectus supplement. Prospective investors should read the prospectus supplement and the prospectus in that registration statement and other documents the Company has filed or will file with the SEC for more complete information about the Company and the offering. You may obtain these documents for free by visiting EDGAR on the SEC’s website at www.sec.gov. Alternatively, copies of the prospectus supplement and the prospectus may be obtained from Citigroup, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, by telephone at (800) 831-9146; Goldman Sachs & Co. LLC, Attention: Prospectus Department, 200 West Street, New York, NY 10282, telephone: 1-866-471-2526, facsimile: 212-902-9316 or by emailing prospectus-ny@ny.email.gs.com; J.P. Morgan Securities, LLC, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717 or by emailing prospectus-eq_fi@jpmchase.com; or UBS Securities LLC, Attention: Prospectus Department, 1285 Avenue of the Americas, New York, NY 10019, or by email at ol-prospectus-request@ubs.com.

This press release does not constitute an offer to sell or the solicitation of an offer to buy shares of common stock, nor shall there be any sale of these 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.

ABOUT RITHM CAPITAL CORP.

Rithm Capital Corp. is a global asset manager focused on real estate, credit and financial services. Rithm makes direct investments and operates several wholly-owned operating businesses. Rithm’s businesses include Sculptor Capital Management, Inc., an alternative asset manager, as well as Newrez LLC and Genesis Capital LLC, leading mortgage origination and servicing platforms. Rithm seeks to generate attractive risk-adjusted returns across market cycles and interest rate environments. Since inception in 2013, Rithm has delivered approximately $5.4 billion in dividends to shareholders. Rithm is organized and conducts its operations to qualify as a real estate investment trust (REIT) for federal income tax purposes and is headquartered in New York City.

FORWARD-LOOKING STATEMENTS

This communication contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements relating to the Company’s ability to complete the offering and the intended use of proceeds. Forward-looking statements are not historical in nature and can be identified by words such as “believe,” “expect,” “anticipate,” “estimate,” “project,” “plan,” “continue,” “intend,” “should,” “would,” “could,” “goal,” “objective,” “will,” “may,” “seek” or similar expressions or their negative forms. Forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time and are beyond our control. Forward-looking statements speak only as of the date they are made. Rithm does not assume any duty or obligation (and does not undertake) to update or supplement any forward-looking statements. Because forward-looking statements are, by their nature, to different degrees, uncertain and subject to numerous assumptions, risks and uncertainties, actual results or future events, circumstances or developments could differ, possibly materially, from those that Rithm anticipated in its forward-looking statements, and future results and performance could differ materially from historical performance. Factors that could cause or contribute to such differences include, but are not limited to, those set forth in the section entitled “Risk Factors” in Rithm’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, including any amendments thereto, filed with the SEC, and other reports filed by Rithm with the SEC, copies of which are available on the SEC’s website, www.sec.gov. The list of factors presented here is not, and should not be, considered a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240924057311/en/

Rithm

Investor Relations

(212) 850-7770

ir@rithmcap.com

Media

Sarah Salky / Erik Carlson

Joele Frank, Wilkinson Brimmer Katcher

(212) 355-4449

ritm-jf@joelefrank.com

Source: Rithm Capital Corp.

FAQ

How many shares is Rithm Capital Corp. (RITM) offering in its public offering?

Rithm Capital Corp. (RITM) is offering 30,000,000 shares of its common stock in the public offering, with an option for underwriters to purchase up to an additional 4,500,000 shares.

What will Rithm Capital Corp. (RITM) use the proceeds from the stock offering for?

Rithm Capital Corp. (RITM) intends to use the net proceeds from the stock offering for general corporate purposes.

Which financial institutions are acting as joint book-running managers for Rithm Capital Corp.'s (RITM) stock offering?

Citigroup, Goldman Sachs & Co. , J.P. Morgan, UBS Investment Bank, BTIG, and Wells Fargo Securities, are acting as joint book-running managers for Rithm Capital Corp.'s (RITM) stock offering.

How can investors access the prospectus for Rithm Capital Corp.'s (RITM) stock offering?

Investors can access the prospectus for Rithm Capital Corp.'s (RITM) stock offering through the SEC's website at www.sec.gov or by contacting the joint book-running managers directly.