Geo Group Inc. (GEO, Financial), a leading private prison operator, is entering the debt market to secure financing. The company aims to raise $1.6 billion through secured and unsecured financing options. This strategic move is designed to refinance existing term loans, revolving-credit facilities, and various notes due between 2026 and 2028.
The financing initiative includes a $400 million leveraged loan with a unique call structure. This arrangement promises a repayment at 102 cents on the dollar to investors, a feature often seen in riskier deals.
Citizens JMP Securities is spearheading the transaction, with a scheduled lender call to take place Monday at 2 p.m. New York time.
The effort to access capital markets comes at a challenging time for private prison operators like Geo Group. Environmental, social, and governance (ESG) concerns have made investors wary, limiting capital market access. However, the current favorable conditions in loan and bond markets have provided an opportunity for these companies to extend their debt maturities. This follows a similar move by CoreCivic Inc., which recently sold $500 million in notes.
