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WHEELER REAL ESTATE INVESTMENT TRUST, INC. (NASDAQ:WHLR), a real estate investment trust (REIT) currently trading below its InvestingPro Fair Value, announced an adjustment to the conversion price of its 7.00% Subordinated Convertible Notes due 2031. The company’s stock has experienced significant volatility, with a year-to-date decline of 98%. The announcement, filed with the Securities and Exchange Commission on Monday, May 5, 2025, stated that the conversion price has been adjusted from approximately $1.97 per share to $0.67 per share of common stock.
This adjustment follows the company’s redemption of Series D Cumulative Convertible Preferred Stock on May 5, 2025. The redemption was processed at $41.03 per share, which included accrued but unpaid dividends. Wheeler REIT issued 774,572 shares of common stock to settle the aggregated redemption price.
The conversion price adjustment was made in accordance with the terms of the indenture governing the notes, which specify that the conversion price be modified based on the lowest price at which any Series D Preferred Stock was converted into common stock. The lowest conversion price for the May redemptions was approximately $1.22, leading to the new conversion price representing a 45% discount to this amount.
Wheeler REIT has processed a total of 349 redemption requests to date, resulting in the redemption of 1,639,903 shares of Series D Preferred Stock and the issuance of approximately 1,586,400 shares of common stock in settlement. As of May 5, 2025, the company reported having 3,845,587 shares of common stock and 1,790,504 shares of Series D Preferred Stock outstanding. According to InvestingPro data, the company maintains a healthy current ratio of 2.18, indicating sufficient liquidity to meet short-term obligations, despite carrying total debt of $492.74 million.
Looking ahead, the next monthly Holder Redemption Date is scheduled for June 5, 2025, with the deadline for redemption requests set for May 25, 2025. The company mentioned the possibility of not having enough registered common stock to settle future redemption requests and plans to file a new registration statement to cover these. However, there is no guarantee that the statement will be effective before the June Redemption Date, which may result in the issuance of unregistered common stock or a delay in delivery pending SEC clearance. With the company’s next earnings report due in just 2 days, InvestingPro subscribers can access 12 additional investment tips and comprehensive financial metrics to better evaluate the company’s prospects.
This news is based on a press release statement and contains forward-looking statements that involve risks and uncertainties. Wheeler REIT explicitly disclaims any obligation to update these forward-looking statements. Information on the company’s website is not incorporated by reference into this report.
In other recent news, Wheeler Real Estate Investment Trust, Inc. has concluded several significant financial transactions. The company completed a stock exchange with investors, issuing 600,000 shares of common stock in exchange for preferred stock, as part of its ongoing financial strategy. Additionally, Wheeler REIT announced an adjustment to the conversion price of its 7.00% Subordinated Convertible Notes, reducing it from approximately $4.56 to $1.97 per share, which increases the number of shares obtainable per principal amount. In another strategic move, Wheeler secured a $10 million loan to support Cedar Realty (NYSE:CDR) Trust’s tender offer for its Series B Preferred Stock, with the loan guaranteed by Wheeler REIT and secured by the company’s cash.
Furthermore, Wheeler REIT has announced a one-for-five reverse stock split of its common stock, effective March 26, 2025, which will adjust the conversion rates of its convertible securities. The reverse stock split will also affect the number of shares authorized under the company’s incentive plans. These developments are part of Wheeler REIT’s broader financial management strategy, as disclosed in their SEC filings. The company has not publicly disclosed further strategic implications of these actions.
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