SUNNY ISLES BEACH, Fla. - Icahn Enterprises L.P. (NASDAQ: NASDAQ:IEP) announced its intention to offer $500 million in Senior Secured Notes due in 2029 in a private placement. The offering, which is not registered under the Securities Act of 1933, involves Icahn Enterprises and Icahn Enterprises Finance Corp. as issuers, with Icahn Enterprises Holdings L.P. acting as the guarantor.
The notes will be backed by a majority of the issuers' and guarantor's assets, with certain exceptions. Proceeds from the sale are earmarked for the partial redemption of the Issuers' 6.250% Senior Notes due in 2026. The offering also includes a lien for the holders of the Issuers' existing notes, ensuring equal and rateable security with the new issuance.
The new securities are available to qualified institutional buyers in the United States and to non-U.S. persons abroad, following respective regulations. The notes and guarantees have not been registered under the Securities Act or any state securities laws and are not available for sale in the U.S. without registration or an exemption.
Icahn Enterprises, a diversified holding company, operates in sectors including Investment, Energy, Automotive, Food Packaging (NYSE:PKG), Real Estate, Home Fashion, and Pharma. The press release includes forward-looking statements, which are subject to risks and uncertainties that could cause actual results to differ materially from expectations.
The information presented in the press release statement is subject to various known and unknown risks, including economic downturns, competition, rising operating costs, investment risks, and market volatility due to geopolitical conflicts, among others.
The company's performance and financial outcomes could be affected by these and other factors, as detailed in their SEC filings under "Risk Factors." The company does not assume any obligation to update or review forward-looking information based on new developments.
This news summary is based on a press release statement and does not constitute an offer to sell or a solicitation of an offer to buy any securities of the Issuers.
In other recent news, Icahn Enterprises L.P. navigated a challenging third quarter in 2024, reporting a decrease in net asset value (NAV) by $423 million, largely due to setbacks in CVR Energy (NYSE:CVI) and the automotive services division. Notably, the company's quarterly distribution was reduced, and the energy segment's EBITDA turned negative. However, the investment fund's performance improved by 8%, despite losses from market hedges.
Icahn Enterprises L.P. maintains a robust liquidity position, ending the quarter with $2.4 billion in cash and funds. Management changes in the automotive services division have begun to show positive trends, and the company is actively exploring the sale of undervalued assets, including a high-value real estate holding in Nashville.
The company is focusing on improving profitability through capital investments, particularly in the food sector, and modernization of facilities to address waste issues and aging machinery. Despite operational challenges and market volatility, Icahn Enterprises L.P. remains poised to leverage its strong cash position to capitalize on market opportunities. These are among the recent developments at the company.
InvestingPro Insights
Icahn Enterprises' recent announcement of a $500 million Senior Secured Notes offering comes at a time when the company is facing some financial challenges. According to InvestingPro data, Icahn Enterprises has not been profitable over the last twelve months, with a negative P/E ratio of -12.76. This context sheds light on the company's need to refinance its existing debt.
Despite these challenges, InvestingPro Tips highlight that Icahn Enterprises pays a significant dividend to shareholders, with a current dividend yield of 15.9%. This high yield could be attractive to income-focused investors, although it's worth noting that the dividend growth rate has declined by 50% in the last twelve months.
The company's revenue for the last twelve months stands at $10.05 billion, but it has experienced a revenue decline of 11.21% during this period. This aligns with the InvestingPro Tip indicating that analysts anticipate sales decline in the current year.
On a positive note, InvestingPro Tips suggest that Icahn Enterprises' net income is expected to grow this year, and analysts predict the company will return to profitability. This potential turnaround could be a factor in the company's decision to refinance its debt through this new offering.
For investors considering Icahn Enterprises, it's worth noting that InvestingPro offers 11 additional tips that could provide further insights into the company's financial health and prospects. These additional tips could be particularly valuable given the complex nature of Icahn Enterprises' diversified business model and the current economic environment.
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