Carvana Revamps $3.3 Billion Junk Bond in Effort to Lure Buyers
- Transaction had attracted limited demand from investors
- Deal to fund acquisition of Adesa’s U.S. car-auction business
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Used-car retailer Carvana Co. is restructuring a multibillion-dollar junk-bond offering as it struggles to attract investors despite double-digit yields.
The company dropped a $1 billion preferred-equity chunk and increased the debt portion by the same amount to a total of $3.275 billion, according to a person with knowledge of the matter. It also added a bankruptcy make-whole provision, a type of safeguard that pays creditors a fee should the company refinance while in chapter 11.