Pagaya announces proposed $450m unsecured senior notes offering

Pagaya announces proposed $450m unsecured senior notes offering

Pagaya, a leading provider of digital media solutions, has announced a proposed offering of $450 million in unsecured senior notes. The notes, which will be issued on July 02, 2025, will carry a 7.25% interest rate and have a maturity date of July 02, 2030. The proceeds from this offering will be used to strengthen Pagaya's balance sheet and support its ongoing growth initiatives.

This unsecured debt offering follows a similar strategy to Clear Channel Outdoor Holdings (CCO), which recently announced a significant debt refinancing [1]. CCO's refinancing involved the issuance of $1.15 billion of 7.125% Senior Secured Notes due 2031 and $900 million of 7.500% Senior Secured Notes due 2033, with the aim of extending debt maturities and adjusting the company's interest rate profile.

Pagaya's proposed offering aims to achieve similar objectives: enhancing financial flexibility, reducing near-term refinancing risk, and adjusting the company's interest rate profile. The 7.25% interest rate on the proposed notes is slightly higher than the current market rate, suggesting increased interest expenses in exchange for extended maturities.

The unsecured nature of Pagaya's proposed notes reflects a different approach compared to CCO's secured notes. While secured notes provide greater protection for investors, unsecured notes can offer more flexibility for the issuer. However, this also means that Pagaya's investors will be relying on the company's creditworthiness and future performance to ensure repayment.

The proposed offering is subject to certain conditions, including the receipt of regulatory approvals and the satisfaction of other customary closing conditions. If the offering is successful, it will provide Pagaya with the necessary capital to support its growth plans and strengthen its financial position.

References:
[1] https://www.stocktitan.net/news/CCO/clear-channel-outdoor-holdings-inc-announces-pricing-of-senior-9nmi595xhfss.html