Granite Construction prices $600 million senior notes offering

Granite Construction Incorporated (NYSE: GVA) priced $600 million in 6.375% senior notes due 2034 in a private offering exempt from Securities Act registration requirements, according to a company statement.

The notes will be guaranteed by Granite's existing and future domestic subsidiaries that serve as borrowers or guarantors under the company's current credit facility, with certain exceptions. The offering is expected to close on June 2, 2026, subject to customary closing conditions.

Granite plans to use net proceeds from the offering, along with cash on hand and payments from capped call transaction counterparties, to redeem all outstanding 3.75% convertible senior notes due 2028. The company estimates the market value of the 2028 notes at approximately $827.3 million, based on the May 15, 2026 closing stock price of $138.55 per share.

The company expects most holders of the 2028 notes will convert their securities following a redemption notice. Granite may settle some conversions partially in common stock shares, which would reduce cash requirements for settlements.

Any remaining proceeds after settling conversions and redeeming the 2028 notes will be used to repay revolving credit facility borrowings and for general corporate purposes.

In connection with conversions or redemption of the 2028 notes, Granite expects to unwind and terminate related capped call transactions. The company would receive payments from counterparty financial institutions equal to the fair value of those transactions at termination.

The notes were offered only to qualified institutional buyers under Rule 144A and to persons outside the United States under Regulation S, as they have not been registered under the Securities Act or state securities laws.

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