JWCA advises Opendoor on its third repurchase of ~$129mm of its convertible notes for cash at meaningful discount to par
november 2023 | read press release
Transaction Background
In March 2023, JWCA advised Opendoor (the “Company”) on its initial cash repurchase of ~$189mm of its 2026 convertible. Several months later, in May 2023, JWCA advised Opendoor on an additional ~$279mm repurchase of its convertible
After addressing nearly half of its 2026 convertible, in November 2023, Opendoor wanted to continue managing its liability profile by opportunistically repurchasing an additional portion of the 2026 convertible at a significant discount to par
Opendoor’s objectives included:
De-lever: retire a portion of the convertible to reduce debt balance and interest expense
Capture a sizeable yield-to-maturity by purchasing the notes at a meaningful discount to par, while also saving a significant amount of cash at maturity
Minimize transaction and friction costs: execute as efficiently as possible with a focus on minimizing execution costs
JWCA acted as Repurchase Agent for the transaction:
Provided analysis and advice around tactics related to investor targeting and engagement
Led the investor outreach, negotiation, and execution of repurchases
Results
The Company executed a successful liability management transaction for its 0.25% coupon convertible notes due 2026:
The Company paid an aggregate amount of ~$90mm in cash for the repurchase of ~$129mm of their convertible notes, which reflected a meaningful discount to par
In combination with the previous repurchase executions in March and May 2023, Opendoor has now retired 61% of the original ~$978mm convertible issuance