Ormat Technologies, Inc. (NYSE:ORA) has expanded its debt offerings with an additional $45,187,000 in 2.50% Convertible Senior Notes due 2027, as reported on Thursday. This issuance adds to the company's existing $431.25 million in notes originally issued in June 2022.
The additional notes, issued on Monday, July 15, 2024, are intended to form a single series with the existing notes, sharing substantially identical terms except for issuance date and initial restrictive legends. Ormat Technologies plans to use the net proceeds to refinance existing debt.
Interest on the notes is set at 2.50% per annum, with payments due semi-annually and a maturity date of July 15, 2027. The notes may be redeemed by the company after July 21, 2025, under specific conditions, including the common stock's sale price exceeding a certain threshold.
Holders can convert their notes into cash, Ormat Technologies' common stock, or a combination thereof, with an initial conversion rate of approximately 11.0776 shares per $1,000 of principal amount, equivalent to an initial conversion price of about $90.27 per share. The conversion rate is subject to adjustments under certain circumstances.
The notes are senior unsecured obligations, ranking equal to unsecured debt not subordinated and junior to any secured debt to the extent of the collateral's value. They are also structurally junior to liabilities of Ormat's subsidiaries.
In the event of a fundamental change, as defined in the indenture, note holders may require the company to repurchase the notes at 100% of the principal amount plus accrued interest. The notes are subject to standard events of default, which could accelerate their maturity.
The details of the indenture and the notes are available in the exhibits attached to Ormat Technologies' current Form 8-K report filed with the SEC. This news article is based on a press release statement.
In other recent news, Ormat Technologies has shown significant financial growth in Q1 2024, with a 21% rise in total revenues, a 25.5% increase in earnings per diluted share, and a 14.4% growth in adjusted EBITDA year-over-year.
This financial uptick is attributed to organic growth, operational efficiencies, and strategic acquisitions, specifically from Enel (BIT:ENEI) Green Power North America. The company has also expanded its renewable energy capacity by adding 130 megawatts of new generating capacity and has signed a 30-year power purchase agreement in Guadeloupe.
Recent developments from Ormat's 2024 Investor Day indicate that the company expects its geothermal projects to yield higher returns, potentially exceeding $100 per megawatt-hour. The company also plans to reduce the timeline for project permitting by approximately 50%.
Analysts from Oppenheimer have maintained an Outperform rating on Ormat's stock, adjusting the price target to $85.00, up from the previous $83.00, reflecting the company's strong prospects.
Ormat Technologies has revised its CapEx budget for 2024 up to $550 million to $570 million due to increased demand for storage projects. The company expects a 7% increase in total revenues and a 10% increase in adjusted EBITDA year-over-year. These recent developments suggest that Ormat Technologies is on a positive trajectory.
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