Redwood Trust plans $50 million convertible notes reopening

Redwood Trust Inc. (NYSE: RWT) announced plans to offer $50 million aggregate principal amount of its 7.75% convertible senior notes due 2027 through a direct placement registered under the Securities Act of 1933.

The notes will be issued as a reopening of the company's existing 7.75% convertible senior notes due 2027, originally issued in June 2022 and expanded in October 2024. Currently, $247.17 million aggregate principal amount of the existing notes remain outstanding.

The Mill Valley, California-based specialty finance company stated it intends to use net proceeds for general corporate purposes. These may include funding its residential and business purpose lending mortgage banking operations, acquiring mortgage-backed securities for its investment portfolio, funding strategic acquisitions and investments, or repaying existing debt.

The company specifically noted the proceeds could be used for repurchasing or repaying a portion of 5.75% exchangeable senior notes due 2025 issued by one of its subsidiaries.

Redwood Trust operates through three residential housing-focused platforms — Sequoia, Aspire, and CoreVest — alongside its Redwood Investments portfolio. The company is structured as a real estate investment trust and focuses on housing credit segments not well served by government programs.

The offering is subject to market and other conditions, according to the company's statement.

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