Opendoor Technologies Inc. Completes $325 Million Exchange and Subscription of Convertible Senior Notes

Opendoor issued $325 million in new convertible notes, exchanging existing debt and raising cash to support operations.

Quiver AI Summary

Opendoor Technologies Inc. announced the completion of the issuance of $325 million in 7% Convertible Senior Notes due 2030 as part of its Exchange and Subscription Agreements with existing holders of its 2026 Convertible Senior Notes and new investors. This transaction involved exchanging approximately $245.8 million of 2026 Notes for the new 2030 Notes and raising $79.2 million in cash. The CFO expressed satisfaction with the transaction, which strengthens the company's financial position and supports its goals in the residential real estate market. The 2030 Notes are secured obligations that will mature on May 15, 2030, and are convertible under certain conditions, with an initial conversion price set at approximately $1.57 per share. Opendoor plans to use the net proceeds for general corporate purposes.

Potential Positives

• Successfully completed the exchange of approximately $245.8 million of 2026 Convertible Senior Notes for new 2030 Convertible Senior Notes, extending the maturity of a significant portion of its debt.
• Raised approximately $79.2 million in cash through the issuance of the 2030 Notes, enhancing the company's liquidity and financial position.
• The 7.000% interest rate on the new notes provides an opportunity for the company to potentially secure lower overall borrowing costs in the long term.

Potential Negatives

• The issuance of 7.000% Convertible Senior Notes at a premium rate may indicate the company's current financial instability or a lack of investor confidence in its future performance, given the high interest compared to market rates.
• The company's debt exchange from the 2026 Notes to the 2030 Notes could be seen as a restructuring of its liabilities, which may raise concerns among investors about its long-term financial health.
• The press release includes numerous forward-looking statements and risk factors that highlight the uncertainty in the company's business strategy and potential vulnerabilities in the residential housing market, which could negatively impact investor sentiment.

FAQ

What are the key details of Opendoor's recent financial transaction?

Opendoor completed an exchange and subscription agreement, issuing $325 million in 2030 Convertible Senior Notes, converting 2026 Notes.

How much cash did Opendoor raise from the recent transactions?

The Company raised approximately $75.3 million in cash from subscription transactions.

What are the terms for converting the 2030 Convertible Senior Notes?

The 2030 Notes are convertible under certain conditions, with an initial conversion rate of 637.1050 shares per $1,000 principal amount.

When do the 2030 Notes mature?

The 2030 Notes will mature on May 15, 2030, unless converted, redeemed, or repurchased earlier.

What is Opendoor's mission in the real estate market?

Opendoor aims to reinvent the U.S. residential real estate industry, making transactions simpler and more customer-centric.

Disclaimer: This is an AI-generated summary of a press release distributed by GlobeNewswire. The model used to summarize this release may make mistakes. See the full release here.

$OPEN Insider Trading Activity

$OPEN insiders have traded $OPEN stock on the open market 14 times in the past 6 months. Of those trades, 0 have been purchases and 14 have been sales.

Here’s a breakdown of recent trading of $OPEN stock by insiders over the last 6 months:

• CARRIE WHEELER (Chief Executive Officer) has made 0 purchases and 3 sales selling 1,113,645 shares for an estimated $1,666,585.
• SYDNEY SCHAUB (Chief Legal Officer) has made 0 purchases and 11 sales selling 220,228 shares for an estimated $325,185.

To track insider transactions, check out Quiver Quantitative's insider trading dashboard.

$OPEN Hedge Fund Activity

We have seen 128 institutional investors add shares of $OPEN stock to their portfolio, and 161 decrease their positions in their most recent quarter.

Here are some of the largest recent moves:

• AMERICAN CENTURY COMPANIES INC removed 17,557,280 shares (-100.0%) from their portfolio in Q1 2025, for an estimated $17,908,425
• RENAISSANCE TECHNOLOGIES LLC removed 10,058,488 shares (-56.9%) from their portfolio in Q1 2025, for an estimated $10,259,657
• MILLENNIUM MANAGEMENT LLC added 8,032,715 shares (+7879.7%) to their portfolio in Q1 2025, for an estimated $8,193,369
• BNP PARIBAS FINANCIAL MARKETS added 7,607,640 shares (+1280.3%) to their portfolio in Q1 2025, for an estimated $7,759,792
• MORGAN STANLEY removed 6,691,931 shares (-44.0%) from their portfolio in Q1 2025, for an estimated $6,825,769
• DIMENSIONAL FUND ADVISORS LP removed 4,274,516 shares (-54.9%) from their portfolio in Q1 2025, for an estimated $4,360,006
• GGV CAPITAL LLC removed 4,185,464 shares (-48.8%) from their portfolio in Q4 2024, for an estimated $6,696,742

To track hedge funds' stock portfolios, check out Quiver Quantitative's institutional holdings dashboard.

$OPEN Analyst Ratings

Wall Street analysts have issued reports on $OPEN in the last several months. We have seen 1 firms issue buy ratings on the stock, and 0 firms issue sell ratings.

Here are some recent analyst ratings:

• Citigroup issued a "Outperform" rating on 04/16/2025

To track analyst ratings and price targets for $OPEN, check out Quiver Quantitative's $OPEN forecast page.

Full Release

SAN FRANCISCO, May 19, 2025 (GLOBE NEWSWIRE) -- Opendoor Technologies Inc. (Nasdaq: OPEN) (the “Company”), a leading e-commerce platform for residential real estate transactions, today announced the completion of its negotiated exchange and subscription agreements (the “Exchange and Subscription Agreements”) with certain holders of the Company’s 0.25% Convertible Senior Notes due 2026 (the “2026 Notes”) and new investors, pursuant to which the Company issued $325.0 million aggregate principal amount of its 7.000% Convertible Senior Notes due 2030 (the “2030 Notes”) consisting of (a) approximately $245.8 million principal amount of 2030 Notes issued in exchange for approximately $245.8 million principal amount of 2026 Notes (the “Exchange Transactions”), and (b) approximately $79.2 million principal amount of 2030 Notes for cash (the “Subscription Transactions” and, together with the Exchange Transactions, the “Transactions”), in each case, pursuant to exemptions from registration under the Securities Act of 1933, as amended (the “Securities Act”), and the rules and regulations thereunder.

“We are pleased to have achieved several key objectives for the Company and our stockholders through this transaction,” said Selim Freiha, CFO of Opendoor. “We successfully exchanged the majority of our outstanding 2026 Notes for 2030 Notes and opportunistically added $75.3 million in cash to our balance sheet—reflecting strong support from our investors. These steps position us to stay focused on our mission to reinvent the U.S. residential real estate industry—making it simpler, more convenient, and more customer-centric.”

The 2030 Notes are senior, unsecured obligations of the Company and accrue interest at a rate of 7.000% per annum. The Company expects that the gross proceeds from the Subscription Transactions will be approximately $75.3 million, excluding offering fees and transaction expenses, and intends to use the net proceeds for general corporate purposes.

The 2030 Notes will mature on May 15, 2030, unless earlier converted, redeemed or repurchased. Before November 15, 2029, the 2030 Notes are convertible at the option of holders only upon satisfaction of certain conditions and during certain periods, and on such day and thereafter, at any time at their election until the close of business on the second scheduled trading day immediately before the maturity date. The Company will settle conversions by paying cash up to the aggregate principal amount of the 2030 Notes to be converted and paying or delivering, as applicable, cash, shares of its common stock or a combination of cash and shares of its common stock, at its election, in respect of the remainder, if any, of its conversion obligation in excess of the aggregate principal amount of the 2030 Notes being converted based on the applicable conversion rate.

The 2030 Notes have an initial conversion rate of 637.1050 shares of common stock per $1,000 principal amount of 2030 Notes (which is subject to adjustment in certain circumstances). This is equivalent to an initial conversion price of approximately $1.57 per share. The initial conversion price represents a premium of approximately 80% over the last reported sale price of $0.872 per share of the Company’s common stock on May 8, 2025.

Holders of the 2030 Notes have the right to require the Company to repurchase for cash all or a portion of their 2030 Notes at 100% of their principal amount, plus any accrued and unpaid interest, upon the occurrence of a fundamental change (as defined in the indenture relating to the 2030 Notes). The Company is also required to increase the conversion rate for holders who convert their 2030 Notes in connection with certain fundamental changes or a redemption notice, as the case may be, prior to the maturity date. The 2030 Notes are redeemable, in whole or in part (subject to certain limitations), for cash at the Company’s option at any time, and from time to time, on or after May 22, 2028, but only if the last reported sale price per share of the common stock exceeds 130% of the conversion price then in effect for a specified period of time. Unless the Company has previously called all outstanding 2030 Notes for redemption, holders of the 2030 Notes may require the Company to repurchase their 2030 Notes on May 15, 2028, at a cash repurchase price equal to the principal amount of the 2030 Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.

J. Wood Capital Advisors LLC served as advisor to the Company in the Transactions.

For additional information regarding the terms of the Transactions, please see the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on May 19, 2025.

About Opendoor

Opendoor is a leading e-commerce platform for residential real estate transactions whose mission is to power life’s progress, one move at a time. Since 2014, Opendoor has provided people across the U.S. with a simple and certain way to sell and buy a home. Opendoor is a team of problem solvers, innovators, and operators who are leading the future of real estate. Opendoor currently operates in markets nationwide.

For more information, please visit www.opendoor.com

Forward Looking Statements

This press release contains certain forward-looking statements within the meaning of Section 27A the Private Securities Litigation Reform Act of 1995, as amended. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking, including statements regarding future financial results including driving toward sustainable positive cash flow; the future health and status of the Company’s financial condition; and its business strategy and mission. These forward-looking statements generally are identified by the words “anticipate”, “believe”, “contemplate”, “continue”, “could”, “estimate”, “expect”, “forecast”, “future”, “guidance”, “intend”, “may”, “might”, “opportunity”, “outlook”, “plan”, “possible”, “potential”, “predict”, “project”, “should”, “strategy”, “strive”, “target”, “vision”, “will”, or “would”, any negative of these words or other similar terms or expressions. The absence of these words does not mean that a statement is not forward-looking. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties that can cause actual results to differ materially from those in such forward-looking statements. The factors that could cause or contribute to actual future events to differ materially from the forward-looking statements in this press release include but are not limited to: risks associated with the Company’s indebtedness and capital structure; the current and future health and stability of the economy, financial conditions and residential housing market, including any extended downturns or slowdowns; changes in general economic and financial conditions (including federal monetary policy, the imposition of tariffs and price or exchange controls, interest rates, inflation, actual or anticipated recession, home price fluctuations, and housing inventory), as well as the probability of such changes occurring, that impact demand for the Company’s products and services, lower the Company’s profitability or reduce its access to future financings; actual or anticipated fluctuations in the Company’s financial condition and results of operations; the Company’s ability to access sources of capital, including debt financing and securitization funding to finance its real estate inventories and other sources of capital to finance operations and growth. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described under the caption “Risk Factors” in the Company’s most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on February 27, 2025, as updated by its periodic reports and other filings with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and, except as required by law, the Company assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. The Company does not give any assurance that it will achieve its expectations.

Contact Information

Investors:



investors@opendoor.com

Media:



press@opendoor.com

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