United Homes Group, Inc. (NASDAQ: UHG) has announced the pricing of a secondary underwritten public offering (the “Offering”) of 7,420,057 shares of its Class A common stock at a price of $5.00 per share. Of the total shares offered, 1,448,200 are being purchased by the Company’s Executive Chairman, Interim CEO, affiliates of Kennedy Lewis Agency Partners, LLC (“Kennedy Lewis”), and other parties identified by management, with the remaining shares purchased by institutional investors.
This Offering consists entirely of shares being issued by the Company to holders of its convertible notes payable, who are participating in the redemption of the Notes. The Offering is expected to close on December 11, 2024, subject to customary closing conditions. The underwriter has a 30-day option to purchase an additional 1,113,009 shares of Class A common stock from the Selling Stockholders. The Company will not receive any proceeds from the Offering.
As part of the transaction, the Company will redeem the Notes for a total of $70,000,000 in cash, plus accrued interest, and 10,168,850 shares of Class A common stock, which include the Offered Shares and any Option Shares purchased by the underwriter. The Selling Stockholders have agreed to retain, and not sell, any Exchanged Shares not sold in the Offering for 120 days, subject to exceptions. If the underwriter exercises its option to purchase the full amount of Option Shares, the Selling Stockholders will retain 1,635,784 shares.
The Company will finance the redemption through a $70,000,000 subordinated loan from a credit agreement with Great Southern Homes, Inc. and Kennedy Lewis, acting as administrative agent, along with other participating lenders. The closing of the refinancing transaction is also subject to certain conditions.
Interim CEO Jamie Pirrello commented, “We are pleased to announce the successful refinance of our convertible debt. By simplifying our capital structure, we are reducing the potential dilutive impact of the convertible notes while increasing institutional stockholder ownership and lowering our annual interest expenses. The transition to a floating rate benchmark is expected to further improve profitability.”
Executive Chairman Michael Nieri added, “We are grateful for Conversant’s early support and excited about our expanded partnership with Kennedy Lewis. Their flexible financing demonstrates confidence in our long-term prospects.”
BTIG is the sole book-running manager for the Offering.
The Offering is made under the Company’s registration statement filed with the Securities and Exchange Commission (SEC), and a final prospectus will be filed with the SEC. Investors can access these documents on the SEC’s EDGAR website or request them from BTIG, LLC.
This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities, nor will there be any sale of securities in jurisdictions where such actions would be unlawful prior to registration under the applicable securities laws.
About United Homes Group, Inc.
United Homes Group is a publicly traded residential builder based in Columbia, SC, operating in high-growth southeastern markets, including South Carolina, North Carolina, and Georgia. The company follows a land-light operating strategy, focusing on the design, construction, and sale of entry-level and move-up single-family homes.
