#United States #San Diego #Convertible Notes #Realty Income #Monthly Dividend

Realty Income Prices $750 Million Convertible Senior Notes Offering

In a significant move that underscores its financial strategy, Realty Income Corporation (NYSE: O), known as The Monthly Dividend Company®, has announced the pricing details of its latest offering of convertible senior notes totaling $750 million. These convertible senior notes carry an interest rate of 3.500% per annum and are set to mature in 2029. The issuance comes as part of a private offering directed at qualified institutional buyers and is expected to settle on January 8, 2026.

Overview of the Convertible Senior Notes

The notes will commence accruing interest from their issuance date, with semi-annual interest payments scheduled for January 15 and July 15 each year, starting from July 15, 2026. Notably, the notes offer a conversion feature that allows holders to convert their notes into shares of Realty Income common stock, based on an initial conversion rate of 14.4051 shares per $1,000 principal amount of notes. This conversion feature is set within a context of potential adjustments based on specific events.

Realty Income recognizes the strategic importance of these notes, particularly as they optimize their capital structure while enhancing investment capacity in a competitive market. The initial conversion price of approximately $69.42 signifies a 20% premium over Realty Income's last reported stock price prior to the announcement, positioning it favorably in the equity market.

Use of Proceeds

The net proceeds from this issuance are anticipated to be around $735 million, increasing to $845.5 million if initial purchasers exercise their option for additional notes. Realty Income plans to strategically allocate these proceeds for various corporate purposes, including:

• - Repayment of existing indebtedness, which includes upcoming maturities of $500 million in senior notes maturing on January 13, 2026.
• - Supporting ongoing acquisitions and development of properties, diversifying their real estate portfolio.
• - Expanding and improving existing properties to enhance tenant satisfaction and operational performance.

Additionally, Realty Income has committed to using about $102.1 million of the net proceeds to repurchase up to 1.8 million shares of its common stock, in privately negotiated transactions, concurrent with the pricing of the offering. This tactic may positively influence the trading price of Realty Income’s stock following the repurchase execution.

Market Conditions and Future Outlook

While Realty Income is commendably well-positioned due to its historical performance, it emphasizes that market conditions and closing stipulations could influence the completion of this offering. They caution that unanticipated events could cause their actual results to drift from the expected norms outlined in their communications.

The commitment to returning capital to its shareholders remains a central pillar of Realty Income’s approach, as evidenced by their impressive history of consistent monthly dividends and their designation as a member of the S&P 500 Dividend Aristocrats index, celebrating over 30 years of increased dividends.

About Realty Income Corporation

Founded in 1969, Realty Income Corporation is recognized as a reliable real estate partner to leading corporations worldwide, with a diversified real estate portfolio exceeding 15,500 properties. The company aims to deliver dependable monthly dividends that appreciate over time, sustaining its identity as a key player in the real estate investment trust (REIT) sector.

In summary, this well-structured convertible note offering not only reflects Realty Income's strategy to consolidate its financial foundation but also signals their commitment to long-term growth and shareholder value enhancement.

Forward-Looking Statements: Realty Income cautions potential investors that forward-looking statements about the offering, organizational growth, and the usage of proceeds could be impacted by various risks and uncertainties.

For further updates and inquiries, investors are encouraged to follow company announcements and reports filed with the SEC.