United Homes Group, Inc. (UHG) announced the pricing of a secondary underwritten public offering on Friday. This offering involves 7,420,057 Class A shares priced at $5 each, aimed at refinancing the company's convertible debt. The transaction is anticipated to conclude by December 11.
Among these shares, 1,448,200 will be acquired by UHG's Executive Chairman, Interim CEO, affiliates of Kennedy Lewis Agency Partners, LLC, as well as other parties. The remaining shares are being snapped up by institutional investors. The entire offering consists of new shares issued by the company to its convertible noteholders as part of the notes' redemption process.
The underwriter has a 30-day option to purchase an additional 1,113,009 Class A shares from the selling stockholders. As a part of the closing, UHG will redeem the notes, exchanging them for over $70 million in accrued and unpaid interest by the settlement date. The redemption will involve a cash payout and the issuance of 10.168 million Class A shares, inclusive of both the offered and option shares.
Partial financing for this redemption will be secured through a credit agreement with Great Southern Homes, Inc. Kennedy Lewis will act as the administrative agent, with participation from other lenders, who will provide a $70 million subordinated loan.
UHG itself will not sell any shares in this offering nor will it receive any proceeds. At pre-market trading on Nasdaq, UHG's stock saw a decline of 10.66%, settling at $5.45.
