The RealReal Enhances Financial Position with Debt Exchanges
The RealReal's Strategic Moves to Strengthen Capital
The RealReal Inc. has made significant strides in enhancing its financial position and capital structure by executing strategic debt exchange transactions. As the world's largest online marketplace for authenticated resale luxury goods, the company has announced its latest navigational steps aimed at reducing total debt while enhancing its growth potential.
A Closer Look at the Debt Exchange Transactions
Recently, The RealReal initiated debt exchange transactions with specific holders of its 1.00% Convertible Senior Notes, maturing in 2028. In exchange for these notes, the company is issuing additional 4.00% Convertible Senior Notes due in 2031. This strategic pivot has allowed The RealReal to reduce its total indebtedness by over $6 million and extend a significant portion of its maturing debt from 2028 to 2031. Following these exchanges, only a fraction under $50 million of the 2028 Notes will be outstanding, enhancing the company's financial flexibility.
Significant Impacts of the Transactions
By exchanging approximately $49.5 million in aggregate principal amount of the 2028 Notes, The RealReal has positioned itself favorably for the future. The completion of these transactions means that the company can now focus on its strategic pillars while continuing to deliver profitable growth amid evolving market dynamics.
Leadership's Confidence in Company Initiatives
Rati Levesque, President and CEO of The RealReal, expressed confidence in these transactions, stating, "We are pleased with the transactions we announced today, reinforcing our commitment to strengthening our balance sheet and reducing our debt. Since the beginning of 2024, we have effectively reduced our total indebtedness by over $86 million, rebalance our debt maturity cycle, and enhance our flexibility to tackle the remaining 2028 convertibles." This strong commitment to financial health presents a positive outlook for the company.
Advisors Guiding the Process
In managing these complex transactions, The RealReal has engaged reputable advisors to ensure effective execution. Moelis & Company LLC serves as the financial advisor, while Wachtell, Lipton, Rosen & Katz acts as legal counsel, providing the expertise needed to navigate these exchanges successfully.
About The RealReal Inc.
The RealReal is not just a marketplace; it is a pioneering force in promoting sustainable luxury. With over 40 million members, it has created a robust platform for buying and selling authenticated luxury items. The company's rigorous authentication process, leveraging experts, ensures safety for consumers while catering to a wide range of luxury categories. From fashion to fine jewelry and art, The RealReal’s offerings support a sustainable circular economy, breathing new life into luxury goods.
Convenience for Sellers
What sets The RealReal apart is its commitment to exceptional service, making selling luxury items effortless for consignors. They provide free virtual appointments, in-home pickups, and seamless drop-off and shipping processes. By managing all aspects from authentication to pricing using advanced technology, The RealReal stands out in the luxury resale market.
Contact Information
For investor inquiries, you can contact:
Investor Relations:
Caitlin Howe
IR@therealreal.com
Press Inquiries:
Mallory Johnston
PR@therealreal.com
Frequently Asked Questions
What is The RealReal?
The RealReal Inc. is the world's largest online marketplace for authenticated resale luxury goods, focusing on sustainable fashion.
What recent financial moves did The RealReal make?
The company engaged in strategic debt exchange transactions, reducing its total indebtedness by over $6 million.
How has the debt exchange impacted the company's strategy?
This has enabled The RealReal to extend a considerable amount of its debt maturity to 2031, enhancing financial flexibility.
Who are The RealReal's advisors for the debt transactions?
Moelis & Company LLC serves as the financial advisor, with Wachtell, Lipton, Rosen & Katz providing legal counsel.
How does The RealReal support sustainable practices?
By facilitating the resale of luxury goods, The RealReal promotes a circular economy, reducing waste while allowing luxury items to have new life.
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