The GEO Group Prices Senior Notes Offering and New Term Loan
April 04 2024 - 4:30PM
Business Wire
The GEO Group (NYSE: GEO) ("GEO" or the "Company")
announced today that it has priced a private offering of $1.275
billion aggregate principal amount of senior notes, comprised of
$650.0 million aggregate principal amount of 8.625% senior secured
notes due 2029 (the "Secured Notes") and $625.0 million aggregate
principal amount of 10.25% senior unsecured notes due 2031 (the
"Unsecured Notes" and together with the Secured Notes, the
"Notes"), exempt from registration requirements of the Securities
Act of 1933, as amended (the “Securities Act”). The Notes will be
guaranteed by GEO's domestic subsidiaries that are guarantors under
a new senior secured credit facility and outstanding senior notes.
The offering of the Notes is expected to close on April 18, 2024,
subject to customary closing conditions. GEO also announced today
that it has priced a new $450.0 million Term Loan B (the “Term
Loan”), bearing interest at SOFR plus 5.25%, under a new senior
secured credit facility, which is expected to close on April 18,
2024. The offering of the Notes and the new Term Loan are expected
to result in net proceeds of approximately $1.67 billion, after
deducting the initial purchasers’ discount and estimated expenses
payable by GEO.
The net proceeds of the offering of the Notes, borrowings under
the new Term Loan, and cash on hand will be used to refinance
approximately $1.5 billion of existing indebtedness, including to
fund the refinance, repurchase, redemption or other discharge of
the Company’s existing Tranche 1 Term Loan and Tranche 2 Term Loan
under its existing senior credit facility, the 9.50% senior second
lien secured notes, the 10.50% senior second lien secured notes,
and the 6.00% senior notes due 2026, to pay related premiums,
transaction fees and expenses. GEO also intends to retire or settle
a portion of the 6.50% exchangeable senior notes due 2026 issued by
GEO Corrections Holdings, Inc., using shares of GEO common stock
and cash. GEO expects to fund the cash portion for the retirement
or settlement, which is expected to total up to $180.0 million,
with a portion of the net proceeds from the offering of the Notes
or, if necessary, cash on hand. Nothing in this press release
should be construed as an offer to purchase, notice of redemption
or a solicitation of an offer to purchase any of the existing term
loans or notes, and the closing of the offering of the Notes is not
conditioned on the consummation of such repurchase, redemption or
other discharge; however, the repurchase, redemption or other
discharge of the existing term loans and notes are conditioned on
the consummation of the offering of Notes and the closing of the
new Term Loan and certain other financing transactions.
The Notes were offered and will be sold in the United States
only to persons reasonably believed to be “qualified institutional
buyers” pursuant to Rule 144A under the Securities Act, and outside
the United States only to non-U.S. persons pursuant to Regulation S
under the Securities Act. The Notes have not been, and will not be,
registered under the Securities Act or any state securities laws
and may not be offered or sold in the United States absent
registration or an applicable exemption from the registration
requirements under the Securities Act and applicable state laws.
This news release does not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of the
Notes 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 The GEO Group
The GEO Group, Inc. (NYSE: GEO) is a leading diversified
government service provider, specializing in design, financing,
development, and support services for secure facilities, processing
centers, and community reentry centers in the United States,
Australia, South Africa, and the United Kingdom. GEO’s diversified
services include enhanced in-custody rehabilitation and
post-release support through the award-winning GEO Continuum of
Care®, secure transportation, electronic monitoring,
community-based programs, and correctional health and mental health
care. GEO’s worldwide operations include the ownership and/or
delivery of support services for 100 facilities totaling
approximately 81,000 beds, including idle facilities and projects
under development, with a workforce of up to approximately 18,000
employees.
Use of forward-looking statements
This press release includes forward-looking statements regarding
GEO's intention to issue the Notes, borrow the term loan and its
intended use of the net proceeds. These forward-looking statements
may be affected by risks and uncertainties in GEO's business and
market conditions. This information is qualified in its entirety by
cautionary statements and risk factor disclosure contained in GEO's
Securities and Exchange Commission filings, including GEO's report
on Form 10-K for the year ended December 31, 2023, and GEO's
reports on Form 10-Q and Form 8-K filed with the Commission. GEO
wishes to caution readers that certain important factors may have
affected and could in the future affect GEO's actual results and
could cause GEO's actual results for subsequent periods to differ
materially from those expressed in any forward-looking statement
made by or on behalf of GEO, including the risks that the offering
of the Notes and/or the closing of the new Term Loan cannot be
successfully completed, that the refinance, repurchase, redemption
or other discharge of its Tranche 1 Term Loan and Tranche 2 Term
Loan under its existing senior credit facility, the 9.50% senior
second lien secured notes, the 10.50% senior second lien secured
notes, and the 6.00% senior notes due 2026 cannot be successfully
completed, and that the retirement or settlement of a portion of
the 6.50% exchangeable senior notes due 2026 issued by GEO
Corrections Holdings, Inc. cannot be successfully completed. GEO
undertakes no obligation to update forward-looking statements to
reflect events or circumstances after the date hereof, except as
required by law.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240404983014/en/
Pablo E. Paez (866) 301 4436 Executive Vice President, Corporate
Relations
Geo (NYSE:GEO)
Historical Stock Chart
From Apr 2024 to May 2024
Geo (NYSE:GEO)
Historical Stock Chart
From May 2023 to May 2024