Travel & Leisure Co. issues $500 million in senior secured notes due 2033

Travel & Leisure Co. (NYSE:TNL) announced Tuesday that it has entered into a material definitive agreement for the issuance and sale of $500 million aggregate principal amount of 6.125% senior secured notes due 2033. The transaction was completed in partnership with U.S. Bank Trust Company, National Association, as trustee, and BofA Securities, Inc. along with other initial purchasers.

According to a statement released by the company, the net proceeds from the offering are expected to be used to redeem all outstanding 6.60% secured notes due October 2025, repay borrowings under its secured revolving credit facility due June 2030, cover fees and expenses related to the offering, and for general corporate purposes, which may include further debt paydowns. The company maintains strong liquidity with a current ratio of 3.72, and InvestingPro data shows its liquid assets exceed short-term obligations.

The notes will bear interest at a rate of 6.125% per year, payable semi-annually in arrears on March 1 and September 1, beginning March 1, 2026. The notes are senior secured obligations and are equal in right of payment with the company’s existing and future senior indebtedness, including obligations under its credit agreement and other outstanding notes.

The notes are not guaranteed at issuance, but the indenture provides for the possibility of adding, releasing, or terminating subsidiary guarantees under certain conditions in the future. The company has the option to redeem the notes, in whole or in part, prior to August 15, 2028, at a redemption price equal to 100% of the principal amount plus a make-whole premium and accrued interest. After August 15, 2028, the notes may be redeemed at specified premiums, and at par plus accrued interest on or after August 15, 2030.

In the event of a change of control triggering event, the company will be required to offer to repurchase the notes at 101% of their principal amount plus accrued and unpaid interest.

Travel & Leisure Co. also confirmed that all conditions for the redemption of its 2025 notes have been met, with the redemption scheduled for September 4, 2025.

This information is based on a press release statement and a filing with the Securities and Exchange Commission. The company’s stock, currently trading at $60.48, appears slightly undervalued according to InvestingPro analysis, which offers comprehensive financial metrics and 8 additional exclusive ProTips for TNL investors. For deeper insights into TNL’s debt management and financial health, access the detailed Pro Research Report available on InvestingPro.

In other recent news, Travel + Leisure Co. has announced a quarterly cash dividend of $0.56 per share, payable to shareholders on September 30, 2025. The company has also priced a private offering of $500 million in senior secured notes due in 2033, with an interest rate of 6.125% per year. This offering is expected to close on August 19, 2025. In terms of analyst activity, JMP Securities has raised its price target for Travel + Leisure from $60 to $70, maintaining a Market Outperform rating. This adjustment follows the company’s second-quarter financial results, which showed an EBITDA of $250 million, aligning with analyst expectations despite a slight revenue miss.

Furthermore, Mizuho (NYSE:MFG) has upgraded Travel + Leisure’s stock from Neutral to Outperform, citing an expected earnings inflection in the latter half of the year. The firm has also raised its price target to $72. Stifel has similarly increased its price target for the company from $66 to $70, maintaining a Buy rating. Stifel highlighted the company’s focus on growing its new owner segment while maintaining strong fundamentals. These recent developments indicate a positive outlook from analysts on Travel + Leisure’s future performance.

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