Carvana's cash interest payments may be slightly less than what they are now, but it's not clear if that will be the case.
#Beyond meat stock forecast 2030 plus
That's roughly $504 million in annual cash interest payments, plus the interest payments from any existing debt that is not exchanged in this transaction. In the third year and beyond, Carvana will be paying 9% cash interest on that $5.6 billion of debt. In other words, the debt reduction is temporary. After two years, the total face value of this new debt will rise from $4.376 billion to somewhere around $5.6 billion if the company makes all in-kind interest payments. The deal will reduce Carvana's total debt by $1.2 billion initially, but the interest payments in the form of additional notes will eat away at that reduction. In year three and beyond, interest payments revert to cash at a 9% coupon rate.Ĭarvana will pay substantially less in cash interest in the two years following this deal, but it will pay a high price for this relief. In the first two years after these new notes are issued, Carvana will be making interest payments in the form of additional notes at elevated rates. And after that two-year period, cash interest payments resume. So when Carvana says that its cash interest expense will be reduced for the first two years, that's true, but the company must hand out additional debt to make it happen. These new notes will come with an option for Carvana to pay interest in the form of additional notes for the first two years. Carvana will exchange up to $4.376 billion of its existing unsecured notes, which have maturities ranging from 2025 through 2030, with new senior secured notes. The meat of the agreement is the exchange offer with existing noteholders. The total face value of those notes is $500 million. Carvana will also commence a cash tender offer for some of its notes that mature in 2025. Shares of Carvana have rocketed higher this year, giving the company an opportunity to cash in and improve its balance sheet. Carvana will issue at least $350 million in new equity, and potentially more. The agreement with noteholders has multiple parts.
#Beyond meat stock forecast 2030 full
That all sounds great, until you look at the company's filing with the Securities and Exchange Commission that lays out the full details.
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