Hannon Armstrong (NYSE:HASI) Sustainable Infrastructure Capital, Inc. (NYSE:HASI), a real estate investment trust focused on sustainable infrastructure, has announced the issuance of $700 million in green senior unsecured notes due 2034 with a 6.375% annual interest rate.
The notes were issued under an indenture dated July 1, 2024, between Hannon Armstrong, its operating partnership, and several subsidiaries serving as guarantors, with U.S. Bank Trust Company, National Association acting as trustee.
The notes, which will mature on July 1, 2034, were offered in a private placement to qualified institutional buyers in the United States and non-U.S. persons in offshore transactions, exempt from the Securities Act of 1933 registration requirements. The company plans to use the net proceeds to repay a portion of outstanding borrowings under its unsecured credit facility and to redeem its 6.00% Senior Notes due 2025.
Furthermore, Hannon Armstrong entered into a registration rights agreement with the initial purchasers of the notes, obligating the company to file an exchange offer registration statement with the SEC. This agreement allows the exchange of the new notes for the original ones within 364 days of the issue date, subject to certain conditions.
In conjunction with this financial move, Hannon Armstrong also announced the termination of its Tax Benefits Preservation Plan effective July 1, 2024. This termination aligns with the company's anticipated reincorporation from Maryland to Delaware, approved by stockholders during the 2024 Annual Meeting on June 6, 2024. The reincorporation is expected to take effect on July 2, 2024.
The notes are senior unsecured obligations of the issuer, ranking equally with all of Hannon Armstrong's existing and future senior unsecured indebtedness. They are effectively subordinated to any secured indebtedness to the extent of the value of the assets securing such debt.
The offering includes provisions for repurchase in the event of a change of control, alongside optional redemption terms. The guarantees from the subsidiaries will be released under specific conditions outlined in the indenture.
This financial activity is based on a press release statement and has been reported in compliance with SEC regulations.
In other recent news, Hannon Armstrong Sustainable Infrastructure Capital priced $700 million green senior unsecured notes due 2034, with an interest rate of 6.375%. The net proceeds, estimated at approximately $688 million, are intended for debt repayment and green project financing. Furthermore, the company announced a strategic $2 billion partnership with KKR, forming CarbonCount Holdings 1 (CCH1) and closing over $500 million in transactions in Q1 2024.
Simultaneously, TD Cowen raised Hannon Armstrong's price target from $35.00 to $40.00, maintaining a Buy rating. This follows the CCH1 announcement and a detailed analysis of the company's first quarter 10Q filing.
In contrast, Citi adjusted the stock's price target to $8.30 from the previous $8.50, while still maintaining a Buy rating, following a reassessment of the company's sales forecast for the years 2024 through 2026, and updates to the gross profit margin projections.
In other developments, Hesai Group, a China-based lidar manufacturer, has initiated legal action against the U.S. government. The company is challenging its inclusion on a Department of Defense list that suggests ties to the Chinese military. Hesai asserts that the majority of its ownership lies outside of China and that its products are designed for commercial and civilian use only. These recent developments underscore the ongoing changes and strategic moves in these companies.
InvestingPro Insights
Hannon Armstrong's recent issuance of green senior unsecured notes is a strategic move to strengthen its financial position and commit to sustainable infrastructure projects. The real-time data from InvestingPro reflects a company with a robust financial standing. With a market capitalization of $3.31 billion and a price-to-earnings (P/E) ratio of 12.43, which slightly adjusts to 13.27 for the last twelve months as of Q1 2024, the company presents a value proposition to investors looking for stability in the renewable sector.
An impressive revenue growth of 35.19% over the last twelve months as of Q1 2024 signals strong operational performance. Moreover, the company's dedication to shareholder returns is evident with a dividend yield of 5.61% and a notable dividend growth of 5.06% during the same period.
These solid financial metrics are complemented by two key InvestingPro Tips: Hannon Armstrong has not only raised its dividend for 5 consecutive years but has also maintained dividend payments for 12 consecutive years, underscoring its reliability as an income-generating investment.
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