AGNC Investment Corp. Announces Public Offering of Depositary Shares
AGNC Investment Corp. (NASDAQ: AGNC) has recently revealed the pricing of a public offering involving 12 million depositary shares. Each depositary share in this offering will have a liquidation preference of $25.00, resulting in gross proceeds that reach up to $300 million before any deductions for underwriting discounts and other expenses related to the offering.
Details About the Offering
This offering, which comes with a firm commitment from a select group of joint book-running managers, will be utilized by AGNC to bolster its portfolio. Each depositary share corresponds to a 1/1,000th interest in a share of the Company's 8.75% Series H Fixed-Rate Cumulative Redeemable Preferred Stock. As part of this transaction, AGNC has granted the underwriters a 30-day option to purchase an additional 1.8 million depositary shares to cater to overallotments.
Use of Proceeds from the Offering
AGNC plans to redirect the net proceeds from this offering primarily towards acquiring Agency securities and non-Agency securities, including credit risk transfer securities. The proceeds will also be allocated for investing in other real estate-related assets, hedging instruments, and general corporate purposes. This initiative underscores AGNC's focus on dynamically managing their investments in alignment with market conditions.
Market Position and Future Goals
Founded in 2008, AGNC has established itself as a leader in the Agency residential mortgage-backed securities market. The company benefits from a robust guarantee against credit losses provided by agencies like Fannie Mae, Freddie Mac, and Ginnie Mae. By leveraging repurchase agreements for financing their Agency MBS assets, AGNC aims to maximize investor returns while mitigating risks associated with market fluctuations and interest rates.
Historical Performance and Shareholder Value
Investor confidence in AGNC is backed by its consistent history of delivering attractive long-term returns to shareholders. Over the years, the company has distributed over $14 billion in common stock dividends, showcasing its commitment to providing substantial monthly dividend income. This history positions AGNC as a significant source of capital for the U.S. residential housing market, indicating a responsible approach to managing mortgage assets during varying market cycles.
Leadership Team Roles
The public offering's underwriting process is managed by some of the most reputable names in finance. Morgan Stanley & Co. LLC, Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, RBC Capital Markets, LLC, UBS Investment Bank, and several others play pivotal roles as joint book-running managers. Their expertise will guide the successful execution and closing of this offering.
Looking Ahead
Though the offering is subject to customary closing conditions, AGNC expects to finalize it on or about September 10. Shares will potentially be listed on The Nasdaq Global Select Market under the symbol “AGNCZ.” With a strategic plan in place to allocate raised funds effectively, AGNC will not only enhance its investment portfolio but also aim for further advancements in the housing market.
Frequently Asked Questions
What is the purpose of AGNC's public offering?
The public offering aims to raise funds which will primarily be used to acquire Agency and non-Agency securities, as well as other investments related to the housing and mortgage markets.
How many depositary shares are being offered?
AGNC has announced the offering of 12 million depositary shares.
What is the expected gross proceeds from this offering?
The offering is expected to generate gross proceeds of approximately $300 million before fees and expenses.
When is the expected closing date for the offering?
The closing of this offering is expected on or about September 10.
Who are the joint book-running managers for this offering?
The offering is managed by a group including Morgan Stanley & Co. LLC, Goldman Sachs & Co. LLC, and J.P. Morgan Securities LLC among others.
