Angel Oak Mortgage REIT, Inc. (NYSE:AOMR) has successfully closed a $50 million offering of 9.500% Senior Notes due 2029, according to a filing with the Securities and Exchange Commission on Thursday. The newly issued debt will mature on July 30, 2029, with interest payments to be made quarterly starting October 30, 2024.
The Atlanta-based real estate investment trust, which primarily focuses on investing in and managing a portfolio of mortgage-backed securities, stated that the offering was guaranteed by Angel Oak Mortgage Operating Partnership, LP. The notes were issued under an indenture agreement with U.S. Bank Trust Company, National Association, serving as the trustee.
The notes, which have been listed on the New York Stock Exchange under the ticker symbol "AOMN," rank equally with the company's other unsecured and unsubordinated debt. They are, however, subordinate to any secured debt to the extent of the collateral value and structurally subordinate to the liabilities of subsidiaries not acting as guarantors.
Angel Oak Mortgage REIT has also reserved the right to redeem the notes at any time on or after July 30, 2026, at 100% of their principal amount plus accrued interest. Additionally, the company is required to offer to repurchase the notes at 101% of their principal amount in the event of a significant change in the company's control.
The issuance of these notes is part of the company's broader strategy to secure long-term financing. The proceeds are expected to be used for general corporate purposes, which may include investments in mortgage-related assets and other debt obligations.
The notes and the guarantee were offered through a shelf registration statement and a prospectus supplement filed with the SEC. This transaction emphasizes Angel Oak Mortgage REIT's ongoing efforts to strengthen its balance sheet and secure capital for future growth.
The information for this article is based on a press release statement.
In other recent news, Angel Oak Mortgage REIT Inc. has disclosed a series of financial developments. The company has raised $50 million through a public offering of its 9.500% Senior Notes due 2029. The net proceeds, approximately $47.7 million, will be used for general corporate purposes, including the acquisition of non-qualified residential mortgage loans and other target assets. A portion of the proceeds will also be used to repurchase approximately 1.7 million shares of the company's common stock from Xylem (NYSE:XYL) Finance LLC.
In addition, Angel Oak Mortgage REIT has extended its loan financing facility with "Multinational Bank 1" through December 26, 2024. This renewal comes with a reduced interest rate pricing spread, potentially lowering the costs of borrowing for the company.
Furthermore, the company reported a 26% year-over-year increase in net interest income for the first quarter of 2024, supported by a $300 million securitization deal. The company also plans to acquire $150 million to $200 million in loans in the second quarter and issue another securitization in the third quarter. These recent developments underline Angel Oak Mortgage REIT's strategic approach to portfolio growth and capital management.
InvestingPro Insights
Angel Oak Mortgage REIT's recent $50 million senior notes offering is part of its strategy to solidify long-term financing and foster growth. A closer look at the company's financials through InvestingPro data reveals a robust growth trajectory with a remarkable revenue growth of 157.89% in the last twelve months as of Q1 2024. This is complemented by an impressive operating income margin of 71.5% in the same period, indicating efficient management and strong profitability.
Investors seeking value may find Angel Oak Mortgage REIT particularly interesting, as it is currently trading at a low earnings multiple, with a P/E ratio of 6.32. Additionally, the company offers a significant dividend to shareholders, boasting a dividend yield of 10.72% as of the latest data. These financials are a testament to the company's solid performance and commitment to returning value to its shareholders. Moreover, Angel Oak Mortgage REIT has demonstrated its financial stability with liquid assets surpassing short-term obligations, which is a reassuring sign for investors concerned about the company's liquidity.
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