Under Armour prices $400 million in senior notes at 7.25%

BALTIMORE - Under Armour, Inc. (NYSE: UA, UAA), the athletic apparel maker with a market capitalization of $2.57 billion, has priced $400 million of 7.250% Senior Notes due 2030 at par in a private offering exempt from Securities Act registration, the company announced Tuesday. According to InvestingPro analysis, the company maintains strong liquidity with a current ratio of 2.1x.

The transaction is expected to close on June 23, subject to customary conditions. The notes will be senior, unsecured obligations with interest paid semiannually and will be guaranteed by Under Armour subsidiaries that provide guarantees under its amended revolving credit agreement.

The athletic apparel maker plans to use the proceeds, along with borrowings under its amended revolving credit agreement and/or cash on hand, to redeem, repurchase, or retire its outstanding $600 million in 3.25% Senior Notes due 2026 within 60 days of closing.

The notes will only be offered to qualified institutional buyers under Rule 144A of the Securities Act and to certain persons outside the United States under Regulation S. The offering has not been registered under the Securities Act and the notes cannot be sold in the United States without registration or an applicable exemption.

Under Armour, headquartered in Baltimore, is a manufacturer and distributor of athletic performance apparel, footwear, and accessories.

This article is based on a press release statement from Under Armour.

In other recent news, Under Armour announced its plan to offer $400 million in senior unsecured notes due in 2030, with the proceeds intended to retire existing debt. This financial maneuver aims to strengthen the company’s balance sheet by addressing its $600 million outstanding Senior Notes due in 2026. Concurrently, Moody’s downgraded Under Armour’s credit rating, citing a negative outlook due to anticipated earnings challenges over the next 12-18 months, influenced by weakened consumer spending and tariff costs. Despite these financial hurdles, Under Armour has expanded its Board of Directors by adding three new members with expertise in finance, sports management, and investment, potentially enhancing its strategic direction.

In the analyst community, BMO Capital Markets reduced its price target for Under Armour shares from $12.00 to $9.00, while maintaining an Outperform rating. The firm highlighted Under Armour’s improved gross margins and strategic focus on financial health over aggressive expansion as positive signs. Meanwhile, Under Armour, along with other major footwear companies, has requested tariff exemptions from the U.S. administration, arguing that current tariffs could significantly raise consumer prices and impact business operations. These developments reflect Under Armour’s ongoing efforts to navigate a complex economic landscape while aiming for long-term stability and profitability.

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