Compass proposes $750 million convertible senior notes offering

Compass, Inc. (NYSE: COMP) announced it intends to offer $750 million in aggregate principal amount of convertible senior notes due 2031 in a private offering, subject to market and other conditions. The real estate services company also plans to grant initial purchasers an option to purchase up to an additional $112.5 million aggregate principal amount of the notes within a 13-day period beginning on the date the notes are initially issued.

The notes will be senior unsecured obligations guaranteed on a senior unsecured basis by each of the company's subsidiaries that guarantee its existing revolving credit facility. Compass stated it intends to use net proceeds for general corporate purposes, including potential repayment of certain existing indebtedness of Anywhere Real Estate Inc. and its subsidiaries if the previously announced merger with Anywhere is completed.

The company will satisfy conversion elections by paying cash, shares of its Class A common stock, or a combination of both, at its election. In connection with the notes pricing, Compass expects to enter into privately negotiated capped call transactions with one or more dealers to reduce potential dilution to its Class A common stock upon conversion of notes.

The notes are being offered only to qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933. The offer and sale of the notes and shares issuable upon conversion have not been registered under the Securities Act.

Founded in 2012 and based in New York City, Compass operates as a tech-enabled real estate services company that includes what it describes as the largest residential real estate brokerage in the United States by sales volume.

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