SOUTHLAKE, Texas - Sabre (NASDAQ:SABR) Corporation (NASDAQ: SABR), a prominent technology provider for the global travel industry, has completed a debt exchange through its subsidiary, Sabre GLBL Inc. On Thursday, Sabre GLBL exchanged approximately $36.2 million of its 7.375% Senior Secured Notes due 2025 and roughly $7.4 million of its 9.250% Senior Secured Notes due 2025 for new 8.625% Senior Secured Notes due 2027, totaling about $50.1 million, plus approximately $256,000 in cash covering accrued interest.
This transaction was conducted with a select group of existing note holders who are qualified institutional buyers or non-U.S. persons, based on private exchange agreements. The newly issued 2027 Notes are an additional issuance to the approximately $853 million of the same notes issued on September 7, 2023, and are fungible with the existing 2027 Notes.
The completion of this exchange leaves the outstanding principal amount of the 2025 notes at approximately $26.8 million and $31.5 million, respectively, while the 2027 Notes' outstanding aggregate principal amount is now approximately $903.1 million.
The 2027 Notes, maturing on June 1, 2027, will be redeemable at Sabre GLBL's discretion starting March 1, 2025, at a rate exceeding their principal amount, plus accrued interest. These notes rank equally with all existing and future senior secured indebtedness of Sabre GLBL and are guaranteed by Sabre Holdings Corporation and Sabre GLBL's current and future restricted subsidiaries.
Advisory and legal services for the transaction were provided by Perella Weinberg Partners LP and Davis Polk & Wardwell LLP, respectively, for Sabre, and Latham & Watkins LLP for Perella Weinberg Partners LP.
This news is based on a press release statement from Sabre Corporation.
InvestingPro Insights
In light of Sabre Corporation's recent debt exchange, a closer look at the company's financial metrics provides additional context for investors. According to InvestingPro data, Sabre currently holds a market capitalization of $827.3 million. Despite the company's efforts to manage its debt, it operates with a significant debt burden, as highlighted by one of the InvestingPro Tips. This is an important consideration for investors, given that high debt levels can have implications for financial flexibility and credit ratings.
On a positive note, Sabre boasts impressive gross profit margins, with the last twelve months as of Q4 2023 showing a gross profit of $1.718 billion and a gross profit margin of 59.09%. This financial health indicator underscores the company's ability to effectively manage its cost of goods sold and maintain profitability on its core services and products. However, it's also worth noting that analysts do not anticipate the company will be profitable this year, which could be a point of concern for potential investors.
The company's stock has experienced significant price volatility recently, with a one-month price total return of -47.22% and a six-month price total return of -56.66%, as of the latest available data. This aligns with the InvestingPro Tips highlighting that the stock generally trades with high price volatility and has taken a big hit over the last week. For those considering an investment in Sabre, these metrics suggest a need for caution and a thorough risk assessment.
For a deeper dive into Sabre Corporation's financials and to access additional insights, readers can explore more InvestingPro Tips on InvestingPro. There are 15 additional tips available, providing a comprehensive analysis that could be invaluable for making informed investment decisions. Remember to use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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