NextNav secures $190 million in convertible notes

RESTON, Va. - NextNav Inc. [NASDAQ: NN], a company specializing in 3D geolocation and positioning, navigation, and timing (PNT) technology, has announced a private offering of $190 million in senior secured convertible notes. The transaction, expected to close around March 31, 2025, is led by M-Cor Capital, LLC and funds managed by affiliates of Fortress Investment Group, alongside other new and existing investors. The company’s stock has shown remarkable momentum, delivering a 93.89% return over the past year, though it recently experienced an 11.65% decline in the past week. According to InvestingPro analysis, the company currently appears overvalued relative to its Fair Value.

The newly issued 5% redeemable senior secured convertible notes, maturing on June 30, 2028, will be utilized in part to redeem NextNav’s existing 10% Senior Secured Notes, which are due on December 1, 2026. Approximately $70 million of the proceeds will cover the redemption and accrued interest.

NextNav’s CEO, Mariam Sorond, expressed confidence that the agreement will bolster the company’s financial position, foster technology investment, and support growth objectives. The company aims to provide a terrestrial alternative to the US GPS system by integrating with 5G infrastructure and device providers.

Josh Lobel, CEO of M-Cor Capital, emphasized the importance of a terrestrial PNT solution as a backup to the GPS system, while Drew McKnight, Co-CEO of Fortress, highlighted the firm’s continued investment in NextNav since January 2020, supporting advancements in geolocation services.

The notes will have a conversion price of $12.56 per share, a 20% premium over the trailing 10-day closing price average before March 11, 2025. Noteholders can opt for conversion, with redemption rights kicking in one year post-issuance if NextNav’s common stock closing price exceeds 160% of the conversion price for a specified period.

In conjunction with the notes, M-Cor and Fortress will receive warrants for purchasing NextNav common stock at various exercise prices.

The securities offered in this transaction are not registered under the Securities Act of 1933 and are subject to restrictions on their offer and sale.

Fortress Investment Group is a diversified global investment manager with $49.0 billion in assets under management as of September 30, 2024. NextNav’s services are positioned for critical infrastructure, GPS resiliency, and commercial applications.

This report is based on a press release statement from NextNav Inc. and does not constitute an endorsement of the company’s claims. The forward-looking statements in the press release are subject to risks and uncertainties that could affect the actual outcomes.

In other recent news, NextNav Inc. has successfully completed both lab and field demonstrations of its new Positioning, Navigation, and Timing (PNT) technology. These demonstrations, conducted in Palo Alto, California, confirmed the technology’s capability to provide precise timing synchronization and robust positioning, marking a significant step toward its commercial deployment. The PNT solution is designed to serve as a terrestrial complement and backup to traditional GPS systems, utilizing 5G Positioning Reference Signal (PRS) standards. NextNav’s Co-Founder and Chief Technology Officer, Arun Raghupathy, emphasized the importance of this milestone in establishing a foundation for a terrestrial GPS alternative. The company’s technology aims to offer scalable 3D PNT capabilities, aligning with their mission to develop a comprehensive terrestrial PNT solution alongside 5G infrastructure and device providers. Additionally, NextNav has petitioned the Federal Communications Commission (FCC) to reconfigure the Lower 900 MHz band to support both 5G-based terrestrial 3D PNT and 5G broadband use. The company plans to showcase its advancements at the Mobile World Congress Barcelona 2025. These developments reflect NextNav’s ongoing efforts in the 5G technology space, focusing on applications that include critical infrastructure and GPS resiliency.

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