Chimera Investment Corporation has priced an underwritten public offering of senior notes totaling $115 million in aggregate principal, bearing interest at 8.875% and set to mature in 2030. The company has also granted the underwriters a 30-day option to purchase up to an additional $17.25 million of the notes to cover potential over-allotments. The offering is expected to close on a date in mid-September, subject to customary closing conditions. Chimera plans to list the notes on the New York Stock Exchange under the ticker symbol CIMP, with trading anticipated to begin within approximately a month after the notes are first issued, if the listing application is approved.
Offering details and pricing
Chimera’s public offering centers on a fixed principal amount of $115 million for the senior notes, which are unsecured obligations of the company. The notes carry a fixed coupon rate of 8.875%, payable in cash on a quarterly basis. The first coupon payment is scheduled for November 15 of the year in which issuance occurs, with subsequent payments occurring on February 15, May 15, August 15, and November 15 of each year. The notes mature on August 15, 2030, providing a defined horizon for investors seeking a long-dated fixed-income exposure tied to Chimera’s mortgage-related asset strategy.
A provision accompanies the offering for potential oversubscription: the underwriters have the right to purchase up to an additional $17.25 million of notes within a 30-day window following pricing. This option is designed to address any demand beyond the initial size and to help stabilize pricing and investor access. The closing of the offering is anticipated to occur on a date in September, contingent on the satisfaction of customary conditions typically associated with private-person-to-public-transaction settlements, including regulatory clearances, market conditions, and other standard requirements. The notes will be issued under Chimera’s existing shelf registration with the appropriate securities regulator framework, enabling a streamlined process for investors and the company alike.
In line with common market practice for new debt offerings, the notes will be placed with institutional investors and other qualified buyers through the underwriting syndicate, which is led by a group of prominent financial institutions. The pricing mechanics and final terms will be disclosed in the official prospectus and any accompanying supplement, which detail the precise mechanics of distribution, interest, and redemption, and outline the rights and obligations of noteholders in relation to the notes and Chimera’s broader capital structure. The offering represents Chimera’s strategy to secure liquidity and raise capital for ongoing investment and corporate activities, while leveraging the company’s existing financing framework.
Listing and trading framework
Chimera intends to pursue a listing of the notes on the New York Stock Exchange, with the expectation that trading could commence within 30 days after the initial issuance, subject to the exchange’s approval and the customary conditions for listing debt securities. The choice to list on a major exchange aligns with Chimera’s objective of providing liquidity options for investors and enabling a transparent, regulated trading environment for the notes. The listing is contingent upon regulatory approval and market readiness, and the company will work with the exchange and regulatory authorities to ensure all listing prerequisites are satisfied.
From an investor perspective, listing on a major exchange often enhances price discovery and liquidity, allowing for more efficient trading and potentially tighter bid-ask spreads. The notes’ senior unsecured status means they will rank above subordinated instruments in Chimera’s capital structure but will be unsecured obligations, carrying the typical credit and market risk associated with mortgage-related investments and credit channels. The coupon schedule and maturity date reflect a long-term fixed-rate instrument designed to fit Chimera’s capital planning and debt management objectives, while offering investors a predictable stream of income aligned with the company’s asset strategies.
Use of proceeds and asset strategy
Chimera’s stated use of net proceeds from the notes centers on financing the acquisition of mortgage-related assets and other targeted assets. Specifically, proceeds may be directed toward purchasing residential mortgage loans, non-Agency RMBS, Agency RMBS, Agency CMBS, and mortgage servicing rights (MSRs). The company may also consider other mortgage-related assets that support its investment objectives, as well as potential strategic investments or opportunities that complement its portfolio management activities.
Beyond asset acquisitions, the proceeds also serve general corporate purposes. These include the repayment of existing indebtedness, reduction of outstanding liabilities, strengthening of working capital, and ensuring liquidity to support ongoing operations and strategic initiatives. This approach aligns with Chimera’s broader objective of maintaining a robust liquidity position while pursuing opportunities to optimize its asset mix, manage risk, and enhance distributable income for stockholders through prudent capital deployment.
In expanding its asset base, Chimera will evaluate the potential benefits of diversifying across mortgage credit fundamentals, including residential loans across different loan types and geographies, as well as diversified RMBS and CMBS securities. The incorporation of mortgage servicing rights can provide additional revenue streams and potential hedging or monetization opportunities as servicing platforms and cash-flow dynamics evolve. The company’s capital-allocation framework aims to balance risk-adjusted returns with maintaining a stable leverage profile and liquidity to respond to changing market conditions.
Debt terms, interest, and redemption rights
The notes issued in this offering are structured as senior unsecured obligations of Chimera, meaning they rank above some other forms of debt in the event of corporate restructuring but do not enjoy secured liens or collateral backing. Interest on the notes is paid quarterly, following a fixed schedule of February 15, May 15, August 15, and November 15, with the initial interest payment occurring on November 15 of the year of issuance. The fixed coupon rate of 8.875% provides a defined yield for investors, subject to prevailing market conditions and Chimera’s credit profile.
The notes are scheduled to mature on August 15, 2030, establishing a clear redemption horizon for investors seeking a long-duration debt instrument linked to Chimera’s mortgage-focused asset strategy. The company has the option to redeem the notes, in whole or in part, at any time or from time to time, starting on August 15, 2027. This redemption flexibility enables Chimera to optimize its capital structure in response to market rates, liquidity considerations, and strategic capital deployment, potentially allowing early repayment if market conditions and corporate objectives align.
The offering will be conducted under Chimera’s existing shelf registration, with the notes offered through a standard prospectus and a corresponding prospectus supplement. This framework provides the regulatory and investor-facing documentation necessary to facilitate the sale and distribution, while outlining the terms of the notes, including interest, maturity, redemption, and any covenants or risk disclosures associated with the instrument.
Management, underwriters, and regulatory framework
The underwriting syndicate for this offering comprises a team of major financial institutions that will manage the sale and distribution of the notes. The joint book-running managers listed in the offering are prominent firms with experience in large-scale debt offerings, contributing to the structure, pricing, and allocation process to ensure an orderly and efficient sale to eligible buyers. These institutions coordinate with Chimera to finalize terms, communicate requirements to investors, and manage the logistical aspects of closing the transaction.
The notes will be offered under Chimera’s existing shelf registration and marketed through the standard channel of a prospectus and a related prospectus supplement. Prospective investors will rely on the disclosures contained in these documents in evaluating the instrument, including the terms of the notes, potential risks, and Chimera’s broader business and financial conditions. While the prospectus provides a comprehensive overview of the offering, it does not constitute an invitation or offer in jurisdictions where such offers would be unlawful, and all sales are subject to applicable securities laws and regulatory requirements.
This section also emphasizes that the press release and related documents are informational and do not constitute an offer to sell or a solicitation of an offer to buy any securities in any jurisdiction where such activities would be unlawful. The process involves standard regulatory review and compliance steps designed to protect investors and ensure transparency, consistency, and fairness across the debt offering.
Forward-looking statements and risk factors
Like many corporate issuances, this transaction contains forward-looking statements that reflect Chimera’s expectations, plans, and beliefs regarding the offering and the anticipated use of proceeds. Such statements are subject to a range of risks and uncertainties that could cause actual results to differ materially from expectations. Readers are cautioned that these forward-looking statements speak only as of the date they are made and that Chimera does not undertake an obligation to update them to reflect changes in circumstances or new information.
Risk factors identified in connection with the offering encompass several areas, including the ability to access favorable funding terms and the capital markets, fluctuations in leverage and liquidity management, and sensitivity to changes in inflation, interest rates, yield curves, and mortgage prepayment behavior. Additional risk considerations involve the integrity of credit risk management for investments, adherence to regulatory standards such as risk-retention requirements, and the potential impact of default, delinquencies, forbearance, or altered recovery rates on investment performance. Geography-related concentration risk, concentration of collateral, and the challenges of executing and realizing the anticipated benefits of acquisitions are also highlighted.
Other factors include changes in the mortgage and housing markets, overall economic or geopolitical conditions, and the company’s ability to integrate acquisitions or optimize hedging strategies. Operational risks such as the performance of servicers and third parties, cybersecurity threats, and the impact of regulatory changes and tax law developments are also cited as potential drivers of deviation from expected results. The risk disclosures extend to the company’s ability to maintain its exemption from registration under the Investment Company Act and to sustain its classification as a real estate investment trust for U.S. federal income tax purposes, among other considerations.
Investors are advised not to rely on forward-looking statements as guarantees of future results. Any updates or revisions to those statements will be subject to the company’s disclosure obligations and applicable securities laws. Comprehensive risk factors and additional information are typically described in Chimera’s public filings with the Securities and Exchange Commission, which provide context for understanding how various factors could influence outcomes.
About Chimera Investment Corporation
Chimera Investment Corporation is a publicly traded real estate investment trust that primarily seeks attractive risk-adjusted returns and distributable income through investment performance tied to mortgage credit fundamentals. The company focuses on investing for its own account and on behalf of third-party clients via its investment management and advisory services. Chimera’s investment activities span a levered approach across a diversified portfolio of mortgage assets, including residential mortgage loans, Non-Agency RMBS, Agency RMBS, Agency CMBS, mortgage servicing rights, and related real estate assets. The firm targets opportunities that align with its risk management framework and capital allocation strategy, aiming to deliver income and capital appreciation for shareholders in a sector driven by mortgage credit markets and financial market dynamics.
In pursuing these paths, Chimera emphasizes the integration of its investment capabilities with its servicing ecosystem, aiming to optimize asset outcomes and support ongoing liquidity, risk control, and capital efficiency. The company remains focused on executing its long-term strategic plan and capital markets initiatives to enhance shareholder value through disciplined asset selection, portfolio management, and efficient capital deployment.
Conclusion
Chimera Investment Corporation’s pricing of an $115 million public offering of 8.875% senior notes due 2030, with a 30-day option for additional issuance, marks a strategic step in strengthening liquidity and supporting the company’s mortgage-focused asset program. The planned NYSE listing under the symbol CIMP reflects an emphasis on enhanced market visibility and investor access, while the intended use of proceeds underscores Chimera’s commitment to expanding its mortgage asset portfolio and fortifying its balance sheet for general corporate purposes.
The notes’ senior unsecured structure, quarterly interest payments, and the redemption option commencing in 2027 provide a flexible capital instrument aligned with Chimera’s asset-management objectives and risk profile. The involvement of a prominent underwriting syndicate, along with the shelf-registration framework, positions the offering to reach a broad investor base under regulatory standards. Investors should carefully review the prospectus and related disclosures to understand the terms, risks, and potential returns associated with this instrument, as Chimera continues its strategy to manage leveraging, liquidity, and asset diversification within the mortgage credit space.
